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Taxes That Could Affect Your Business’s Importing Of Goods

Importing goods in Australia can be subject to a range of different taxes, rules and procedures

As an island country, Australia imports a lot of the products that businesses sell. Whether it’s a paperback bestseller from the New York Times, a luxury car for a dealership or heavy machinery for the mines, taxes on the imports of these goods is an issue that needs to be addressed and outlined.

It’s often a complex area, and those taxpayers that fail to abide by the many rules and regulations surrounding the different imports can be penalised with unexpected costs.

The main import taxes in Australia that you need to be aware of and concerned with primarily are the Goods and Services Tax (GST) and customs duty. In specific circumstances, some imports may have other taxes applied to them on top of that. This might include the Wine Equalisation Tax for wine imports or the Luxury Car Tax for certain car imports, for example.

GST is payable on most goods that are imported into the country. It is usually about 10% of the value of the taxable importation.

GST on a taxable importation (product) is payable by businesses, organisations and private individuals, whether they are registered for GST or not. If a business is GST-registered, and importing goods is a part of their activities, a GST credit may be claimable for any GST paid on the imported goods.

Refunds and concession schemes that may be available to importers of goods can include:

  • A refund of the customs duty and GST on the import where they subsequently export the good from Australia (under the duty drawback rules)
  • The Deferred GST Scheme – this scheme allows GST-registered businesses that import goods to defer the GST payable on import until they lodge their business activity statement (which a registered tax agent like us may be able to help with).

For tax or business queries with regard to the importation of goods, registered tax agents can have the knowledge that you need. Speak with us to find out how we might be able to assist.

If you’re someone who often finds it difficult to make large lump sum payments for goods or services, you may want to consider looking into “Buy Now Pay Later” services.

Buy now pay later essentially means that, rather than paying in a full lump sum payment for a product or services rendered, there may be an option to pay through instalments of a certain amount over a set period to make the sum of the full amount in total. This method should allow you to pay in full for the product or service without overly straining your finances – you pay back what you can, as agreed upon when you begin the buy now pay later service.

Some popular buy now pay later services include Afterpay, Zip Pay, Brightepay, and some credit card networks such as  Mastercard and Visa, can offer buy now pay later arrangements.

Though it can be a convenient, immediate solution, it may be challenging to juggle the necessary repayments with other financial commitments. It’s not always the most appropriate method for people, and you should bear in mind your situation and ability in paying back the amounts. 

Before you sign up, keep in mind: 

  • It becomes easier to overspend with buy now pay later services, so know your limits on what you can and can’t afford.
  • You will be charged fees and costs to use the service, which can add up to a princely sum in and of itself.
  • Keeping track of your payments can be tricky if you’ve signed up for multiple services.
  • It could affect your loan applications for a car or mortgage as lenders consider buy now pay later spending just as much as your credit score.
  • Late repayments can appear on your credit report, which affects your ability to borrow money in the future.
  • Layby can be a cheaper alternative to buy now pay later, with no account-keeping or late fees to consider

If you are someone who could make use of BNPL services, you may wish to:

  • Ensure that when using the BNPL service, you stick to a set limit on what you spend so that you can comfortably pay it back later. 
  • Aim only to have one BNPL account at a time to manage payments through, rather than confuse yourself with multiple payments across different providers.
  • Always budget for bills, loan payments and BNPL payments, and 
  • Rather than use your credit card for payments to your BNPL account, consider linking to your debit account instead.

If you would like assistance in planning your financial future, help in managing your budget or some friendly advice, see us for a chat about what we can do for you.

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Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

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David and Alison Parker

I have been consulting J L Noller and Co. (more specifically Jane) for six years and during this time I have found her to be professional, efficient and easy to discuss all accounting and taxation matters with. Her office team are all polite and friendly also.

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Carl Gillmore

I have used Jane & the team for the last 6 years for all of my business & personal accounting needs. They have always been professional, easy to talk to & available when we have needed assistance.

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John Briggs

Jane Noller has been my accountant for the last 15 plus years. I can testify to Jane’s professionalism and expeditious manner in dealing with the day to day issues that surrounds our business accounting.

John Briggs

Registered Building Certifier