GST on Exports: Know the Conditions, Claim the Benefit
Exports are generally GST-free under Australian law — but that status isn’t automatic. To qualify, businesses must meet certain timing requirements and provide adequate evidence. Too often, companies make assumptions about their GST-free eligibility and then find themselves exposed during an ATO review.
Key Conditions for GST-Free Exports:
- Timing Matters
The goods must be exported within 60 days of receiving payment or issuing the invoice — whichever comes first. For services connected with exports (e.g., arranging shipping), different rules may apply.
- Evidence Is Essential
Businesses must retain clear documentation proving that:
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- Acceptable evidence includes commercial shipping documents (e.g., bill of lading), customs declarations, and proof of overseas delivery.
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- The goods physically left Australia.
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- The export occurred within the required timeframe.
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- The supply was intended for export from the outset.
- Assumptions Can Be Costly
Many businesses rely on informal methods like forwarding emails or spreadsheet tracking — which may not meet audit standards. If the ATO challenges the GST-free status and the evidence is lacking, you could be liable for the GST, interest, and penalties.
Best Practices:
- Use a formalised process or digital tool to track export timelines.
- Maintain a checklist for documentation before applying GST-free treatment.
- Review your export invoices regularly to ensure compliance.
Time for a Process Review?
If you’ve been relying on ad hoc records, now’s the time to formalise your approach. The GST-free benefit is worth claiming — but only if you can prove you’re entitled to it.
BTG helps businesses across Australia review and strengthen their GST export processes — from documentation checks to process improvements — reducing audit risk and ensuring GST-free status is applied correctly. If you’re open to a chat, contact us today!
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