Running a small business in Western Australia comes with many responsibilities, and meeting your tax obligations is one of the most crucial. Whether you’re a sole trader, a partnership, or a company, understanding GST (Goods and Services Tax) and BAS (Business Activity Statements) is essential to staying compliant and avoiding costly penalties.

Many small business owners feel overwhelmed by tax requirements, especially if they are new to the process. This guide provides clear, practical, and updated 2026 information to help you understand what GST and BAS mean for your business—and how to manage them efficiently.

1. Understanding GST: What It Really Means for Small Businesses

GST (Goods & Services Tax) is a 10% tax placed on most goods and services in Australia. As a small business in Western Australia, you must charge GST on taxable sales once you register.

You must register for GST if:

• Your annual turnover is $75,000 or more
• You operate a non-profit organisation earning $150,000 or more
• You want to claim GST credits on your purchases
• You work as an Uber/ride-share driver (compulsory)
  

Registering for GST means you must:

• Charge 10% GST on sales
• Issue tax invoices
• Lodge BAS either quarterly or monthly
• Keep adequate records
  

Understanding these basic requirements lays the foundation for accurate tax reporting.

Also Check: Why Every Small Business Needs a Financial Advisor

2. When You Must Register for GST in WA

Many Western Australian small businesses, especially startups, begin below the GST threshold. However, once your turnover reaches $75,000, registration becomes mandatory.

It is your responsibility to track your turnover monthly. If your turnover is projected to exceed the threshold within the next 30 days, you must register immediately.

Failing to register can result in:

• ATO penalties
• Late fees
• Backdated GST payments on past sales

Register early if you expect rapid growth—this avoids surprise liabilities.

3. What Is a BAS and Why Do You Need to Lodge It?

Your Business Activity Statement (BAS) is how you report:

• GST collected
• GST credits claimed
• PAYG withholding
• PAYG instalments
• Fuel tax credits (if applicable)

In Western Australia, most small businesses lodge BAS quarterly, though some choose monthly lodgement for better cash flow management.

Quarterly BAS due dates:

• Q1: 28 October
• Q2: 28 February
• Q3: 28 April
• Q4: 28 July
  

A bookkeeper, such as JGW Bookkeeping Services, can help you stay on top of deadlines and avoid last-minute stress.

4. GST on Sales: How to Apply It Correctly

If your business is registered, you must add 10% GST to most goods and services sold in WA. This includes:

• Retail products
• Professional services
• Trades and construction services
• Digital services

However, some items are GST-free, such as:

• Basic food
• Some medical supplies
• Educational courses
• Certain childcare services

When issuing tax invoices over $82.50, ensure that:

• GST is shown separately
• Your ABN is listed
• “Tax Invoice” is clearly written
• Your business name and date are included

Correct invoicing protects your business from ATO audit issues.

Also Check: 5 Common BAS Errors and How to Avoid ATO Penalties in 2026

5. Claiming GST Credits: What You Can and Cannot Claim

GST credits (also called input tax credits) reduce the amount of GST you need to pay. You can claim credits on business purchases such as:

• Tools, software, or equipment
• Office supplies
• Utilities
• Business travel
• Marketing expenses
• Bookkeeping or professional fees

To claim credits, ensure:

• The purchase is 100% business-related
• You have a valid tax invoice
• The supplier is GST-registered

You cannot claim GST credits on:

• Private expenses
• Entertainment
• Certain motor vehicle purchases
• Items used for both business and personal use (unless apportioned)

Good record-keeping ensures accurate BAS lodgement.

6. Record-Keeping Requirements for WA Small Businesses

Accurate records are essential for both GST and BAS compliance. The ATO requires businesses to keep records for a minimum of five years.

Records must include:

• Tax invoices
• Receipts and purchase orders
• Employee payment summaries
• Business bank statements
• Contracts and agreements
• BAS lodgement confirmations

Digital bookkeeping systems like Xero or MYOB make compliance easier, especially when integrated with professional bookkeeping services.

Also Check: Payroll Outsourcing Services in Perth: Is It Right for Your Business?

7. Avoiding Common GST & BAS Mistakes

Mistakes can lead to ATO scrutiny or financial penalties. Common errors include:

• Claiming GST credits without valid tax invoices
• Failing to report all income
• Mixing personal and business expenses
• Late BAS lodgements
• Incorrect GST coding in accounting software
• Forgetting to apply GST to taxable sales
• Not tracking the $75,000 turnover threshold

Hiring an experienced WA bookkeeper ensures compliance and reduces your risk.

8. Cash vs Accrual Accounting for GST

When registering for GST, you must choose either:

Cash Accounting

You report GST when payments are received or made.
Best for small businesses with tight cash flow.

Accrual Accounting

You report GST when invoices are issued, even if unpaid.
Best for growing businesses or those issuing large invoices.

Choosing the right method can significantly affect your cash flow and BAS obligations.

9. GST for Contractors and Freelancers in Western Australia

Many WA contractors—electricians, digital marketers, web designers, and tradespeople—struggle with GST rules.

Key obligations:

• You must issue tax invoices
• You must keep GST records
• You must include GST in quotes and estimates
• You must lodge BAS regularly

Contractors are often audited for improper GST claims, so accuracy is vital.

Also Check: The Ultimate Guide to Bookkeeping Services for Small Businesses in Perth (2025)

10. How Professional Bookkeeping Helps WA Small Businesses

Managing GST and BAS alone can be time-consuming. A professional bookkeeping service, such as JGW Bookkeeping Service,s can help:

• Prepare and lodge BAS
• Manage GST coding
• Keep your bookkeeping updated
• Reduce ATO risks
• Help with GST registration
• Reconcile accounts
• Provide financial clarity

With expert support, you can avoid errors and fines while focusing on running your business.

Conclusion

Understanding GST and BAS is essential for small business owners in Western Australia, especially as tax regulations continue to evolve in 2025. Staying compliant means:

• Knowing when to register for GST
• Charging and claiming GST correctly
• Keeping accurate records
• Lodging BAS on time
• Seeking professional help when needed

If you’re unsure about your GST or BAS obligations, JGW Bookkeeping Services can guide you through the entire process. With the right support, managing tax becomes simple, stress-free, and fully compliant with ATO requirements.