3.3 GST Impact

GST Start-Up Assistance Office

Taking control of your future

Managing your business in a GST environment is not about accounting. It is a goods and services tax and impacts the way your business operates. The level of impact depends on the size of your business and the type of business.

The GST changes the way a business can operate in Australia. Some may only change because they have to. Others consider the impact of the GST on their Business Cycle and decide that they want to make changes to the way they operate.

Operating your business under GST

Because you know your business, you are the best person to assess the impact of the GST


You know your business and you are the best person to assess the impact and decide any changes or adjustments. Because the way your business operates is different from any other business, you are the best person to make decisions.

To do this you need to look at each stage of your Business Cycle and put on a different 'hat' to check for opportunities or impacts. There are many different areas of impact. In this section we look at five: selling, buying, recording, survival and legal.

Think of one area at a time

It is difficult to consider more than one area of GST impact at a time. Using a focused approach makes the GST impact manageable and practical for you, or others.

To assist in taking a focused approach think of wearing different hats. Each hat represents a role that you, or someone, needs to take on. Putting on one hat at a time allows you to focus on what needs to be done at that particular stage.

Who wears the hat in your business?

Decide who is responsible for GST


Everyone in business is busy and lack of time is common. People can get so tied up in the day-to-day activities that they forget to stop and think. By focusing your time on who is responsible for GST, you can keep your business going and growing.

Managing your business under GST is ultimately your responsibility and you need to decide who is going to take responsibility for different areas, or wear each hat. This could be:

yourself, or you pass on the responsibility to a coordinator
a team of people in your business who have different roles
external professionals who can wear some, or all, of the hats

What if you are the only person in your business?

Taking control of your future

Even if you are the only person in your business, you still need to wear one hat at a time. Doing this keeps your focus on:

what is happening in your Business Cycle
managing the GST impact on your Business Cycle
identifying where you can do it and where you need extra help such as other people, e.g. friends and family, or information

What if you are part of a larger business?

Having more people in your business means you can get them to help you. You need to at least wear the hats temporarily so you know what others need to do.

Once you have done this you can decide who might be the best person to wear each hat. You might even find that it helps to have a couple of people share roles.

There are five different hats you need to wear

Looking at the diagram below, you can see the hats you need to wear are the different areas of impact for GST. These areas of impact are grouped into five topics:

Selling impact
Buying impact
Recording impact
Survival impact
Legal impact

The five hats

Making the link between your business and GST

Your business and how it works

To make GST more manageable it helps to look at different parts of the Business Cycle and see where GST impacts your business. By using this approach you can:

identify the main areas of impact
focus your efforts on 'chunks' of tasks
start prioritising issues and making plans
plan and allocate the right person for each task

You can see how GST impacts each stage of your Business Cycle in different degrees depending on the nature of your business.

The following diagram shows the Business Cycle as a wheel. When you focus on one of the five areas of impact from the hub of the wheel, certain parts of the Business Cycle are highlighted. We will examine these in detail next few sections.

To see which parts of the business cycle correspond to which hat, click on the hat. Double clicking on the hat will take you directly to that section.

Selling Survival Buying Recording Legal


Major areas of impact

In the following pages we examine each major area of impact in more detail and link each to the Business Cycle. Ideally you should follow the topics in order of their impact on the Business Cycle.