GST-Exclusive Price
The base price of a good or service before 10% GST is added.
A GST-exclusive price is the base price of a good or service before the 10% GST is added. While consumer-facing prices in Australia are typically displayed GST-inclusive, business-to-business transactions often quote prices GST-exclusive, with GST added as a separate line item on the invoice. This is common in wholesale, professional services, and construction industries.
To convert a GST-exclusive price to a GST-inclusive price, multiply by 1.1. For example, a service quoted at $1,000 + GST will cost $1,100 in total, with $100 being the GST component. If you're GST-registered, the $100 GST is claimable as an input tax credit, making the effective cost to your business $1,000.
When comparing quotes from different suppliers, always compare on the same basis (either all GST-inclusive or all GST-exclusive) to avoid confusion. Some industries, particularly construction and trades, commonly quote ex-GST, while retail and consumer services must display inclusive prices. Software accounting packages typically handle GST calculations automatically when you select the appropriate tax code.
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Goods and Services Tax (GST)
A 10% broad-based consumption tax applied to most goods, services, and other items sold or consumed in Australia.
GST-Inclusive Price
A price that already includes the 10% GST component. The GST amount is 1/11th of the inclusive price.
Input Tax Credit
A credit for GST included in the price of goods and services purchased for business use, offsetting GST collected on sales.
Business Activity Statement (BAS)
A form lodged with the ATO to report and pay GST, PAYG withholding, PAYG instalments, and other business tax obligations.