GST on Craft Beverages in Australia: A General Guide for Online Sellers

What the tax does to your price

GST on craft beverages in Australia is a tax collected through taxable sales, not a charge that automatically becomes your profit. The Australian Government’s business.gov.au says GST is 10% on most goods, services and other items sold or consumed in Australia. Registered businesses collect the GST portion, one-eleventh of the sale price, and must register once GST turnover is $75,000 or more, within 21 days of knowing they will exceed that threshold (Source: business.gov.au (Australian Government)).

Inclusive and exclusive prices

Use the GST-inclusive price for the customer-facing decision: it is the amount shown on your shelf, product page or checkout. For a taxable sale, business.gov.au says GST is 10% and the GST portion of an inclusive price is one-eleventh. So an advertised price of A$110 includes A$10 GST and A$100 before GST (Source: business.gov.au (Australian Government)).

Use the GST-exclusive amount when comparing bookkeeping entries, supplier costs and product margins, provided the relevant GST can be treated that way in your records. For illustration only, if your own supplier invoice is A$55 including GST, calculate the pre-GST amount as A$55 ÷ 1.1 = A$50; if your own customer sale is A$110 including GST, calculate A$110 ÷ 1.1 = A$100. The comparison is A$100 less A$50, not A$110 less A$55. The product pricing calculator can help check this arithmetic.

Do not apply one treatment automatically to every line. Product sales, freight, payment fees, marketplace charges, discounts, refunds and imported goods may have different GST treatment or documentation. GST generally applies to low-value physical goods imported by Australian consumers, goods valued at A$1,000 or less, according to business.gov.au, but the customs-value rule excludes transport and insurance. Confirm the tax status shown on each invoice before using a figure in margin analysis (Source: business.gov.au (Australian Government)).

How to read the worked example

Read the worked example from the selling price down, keeping each measure separate. The selling price is the amount charged to the customer. The GST component is the portion of that price collected for GST, rather than revenue available to cover the product’s costs or profit. The remaining sales amount is the revenue used in the margin calculation.

Next, check the cost base. This is the direct product cost included in the example, so confirm that it is treated on the same GST basis as the sales amount. Subtracting the cost base from the relevant sales revenue gives the gross profit: the dollar amount retained before advertising, wages, rent, payment fees, freight and other operating expenses. The gross margin expresses that gross profit as a percentage of revenue, making it easier to compare products with different selling prices.

The key reading is therefore not simply whether the customer price includes GST. Check how much of the price is GST, how much revenue remains after removing it, what direct cost is deducted, and what is left before other expenses. For a broader product-level view, ORVX’s product pricing calculator can help structure the same checks.

Compare sales GST with your margin

GST collected is a tax movement, not sales revenue. Business.gov.au states that GST is 10% on most Australian sales and that the GST component is one-eleventh of the GST-inclusive price. For a $1,100 order, $100 is GST and $1,000 is sales before other adjustments. Discounts and refunds reduce what you actually realise; payment fees, freight and other operating costs reduce profit after that (Source: business.gov.au (Australian Government)).

Records worth keeping

Keep records that let you trace each reported GST amount back to an actual transaction. For every sale, retain the order or point-of-sale record, invoice or receipt, product, quantity, price, GST treatment, payment status and fulfilment status. This makes it possible to separate completed taxable sales from cancelled orders, unpaid orders and orders later refunded.

Purchase records should connect stock bought for resale to the supplier document and payment. Keep supplier invoices, credit notes, freight or import documentation where relevant, and the GST treatment used in your accounts. Reconcile these records to purchases and input tax credits rather than estimating from bank deposits or stock movements alone.

Adjustment records are just as important as the original sale. Link each return, refund, cancellation, partial refund, post-sale discount or pricing correction to the original order, with the date, amount and reason. The resulting audit trail should explain why sales GST or purchase GST changed between reporting periods. These records support your accounting and GST reporting obligations; they do not replace the record-keeping system, source documents or retention requirements that apply to your business.

• Use transaction records to reconcile reported sales with completed orders.
• Use invoices and purchase documents to support purchase entries and GST treatment.
• Use linked adjustment records to explain refunds, returns, cancellations and corrections.
• Compare the accounting records with payment settlements and inventory movements to find omissions or duplicates.

When to ask an adviser

Ask a registered tax adviser when you are unsure whether a product is taxable, GST-free or otherwise treated differently. Craft beverage stores may sell products with different classifications, packaging or serving arrangements, so do not assume one treatment applies across the catalogue. Get advice before changing product prices, tax settings or invoice wording.

Mixed and bundled orders also warrant confirmation. Ask how GST should be handled when a gift box combines beverages with other goods, a bundle has one advertised price, or a discount applies to only some items. Confirm the treatment of partial refunds, returned products, cancelled orders, store credit and changes made after an invoice has been issued.

Seek advice if you sell through a marketplace, because the platform’s role and reporting may affect your records and reconciliation. Imports and exports should be checked before you quote landed prices or promise tax treatment to customers; GST can depend on the transaction and the goods’ circumstances. Recheck your position when turnover, business structure, fulfilment location, product range or sales channels change. A registered tax adviser can confirm the treatment for your actual transactions and reporting obligations rather than relying on a general pricing rule.

GST decisions affect both the price a customer sees and the margin figures used to run the store. Use the worked example to check how each amount moves through the transaction, keep records that support the calculation, and confirm any product-specific or unusual treatment with a qualified adviser.