Australia Import Guide
Import Costs, GST, De Minimis, and GST Requirements Based on Annual Sales
All countries can assess imports and their various tariffs and levies upon goods imported into the country. Generally, these tariffs and levies are in the form of import duties, taxes, and other ancillary customs fees. These ancillary customs fees include import processing charges, excise duty/tax for certain commodities (alcohol, tobacco, and luxury goods, for example), and other import/inward processing fees. In Australia, imports are generally subject to the following suite of import tariffs and levies:
- import duty which is normally 5% FOB (see FOB note below), but can be higher for specific commodities;
- import tax (GST) which is 10% CIF + duty amount x GST rate (see calculation note below);
- import processing charge (IPC), which depends on the transportation method, entry type, and shipment value; (see IPC note below)
For different reasons- economic promotion, trade facilitation, modernization, etc., countries may also determine a threshold below which the importer may not be required to pay any import duty and/or tax. This is generally referred to as the de minimis. In Australia, the Australian Border Force (“ABF”) and the Australian Taxation Office (“ATO”) have set the de minimis threshold for imports at $1,000 AUD for both import duty and import tax (GST). If the value of the goods on your shipment to Australia is under $1,000 AUD (and is not ineligible for de minimis treatment), there is no duty, import tax (GST), or IPC payable at the time of import.
- For most goods with a value of $1,000 AUD or less, there are no duties, taxes, or charges to pay at the time of import.
- You must pay duties and taxes on some goods (like tobacco, tobacco products, or alcoholic beverages) regardless of their value. This category of goods is subject to an excise tariff and is not eligible for the $1,000 AUD de minimis duty/tax exemption.
- If the goods on your import shipment into Australia are valued at greater than $1,000 AUD, the goods will be subject to duty, GST, and IPC at the standard published rate, and these fees must be paid at time of import.
Important GST Stipulations for Non-Resident Businesses Based on Annual Sales Since July 2018, new regulations exist which may require non-resident businesses who sell goods, services, real estate, and other digital products to Australian consumers to register for, collect, and pay 10% sales GST to the ATO if their annual turnover to consumers in Australia is greater than $75,000 AUD or $150,000 AUD if a non-profit organization.
This is unique as it essentially requires the non-resident business to pay 10% GST, even if the original shipments were imported under de minimis thresholds and therefore were not assessed for any import duty, tax, or fees at the time of import.
ATO has determined that non-resident businesses must register for, collect, and pay the 10% GST if both the following apply:
- “You are carrying on a business or enterprise.
- Your GST turnover from sales connected with Australia from your enterprise is equal to, or greater than the registration turnover threshold of $75,000 AUD (or $150,000 AUD if you are a non-profit organization).”
The ATO has further clarified that you reach the GST turnover threshold if either:
- ‘your current GST turnover’ (your turnover for the current month and the previous 11 months) totals $75,000 AUD or more ($150,000 AUD or more for non-profit organizations)
- your ‘projected GST turnover’ (your total turnover for the current month and the next 11 months) is likely to be $75,000 AUD or more ($150,000 AUD or more for non-profit organizations).”
The Bottom Line for FlavorCloud Customers
If you meet the criteria outlined above, you must register for, collect, and pay the 10% sales GST, even if the original imports were under the de minimis threshold at the time of being imported.
If you need to register for GST, further details, including GST registration options for Australia, definitions, resources, and links, are available here:
- Key Regulation: 2018 LCR 2018/1 – ATO Law Companion Ruling for GST on Low-Value Imported Goods
- How Australian GST Works
- If GST Applies
- ATO Non-resident businesses and GST and GST for Non-Residents
- GST Registration Options
- How to charge GST on imported services, digital products and low value imported goods
- GST Lodgment and Payment Options
References & Glossary
Import Processing Charge
Applies to all consignments over $1,000 AUD (FOB) for N10 Import Declarations and N20 Warehouse Declarations:
Electronic Lodgement (Entry)
- $1,000 AUD to $9,999 = $50 AUD
- $10,000 and greater = $152 AUD
Documentary Lodgement (Entry)
(only applies to certain types of transactions and specific situations where formal import entry is required)
- $1,000 AUD to $9,999 = $90 AUD
- $10,000 and greater = $192 AUD
CIF Calculation Method Note
CIF = Cost of Goods + Insurance + Freight
+ Cost of Goods is the Transaction Value [actual price paid or otherwise would be payable by the buyer to the seller for the goods]
+ Insurance costs
+ Shipping charges
FOB Calculation Method Note
Unlike CIF, the customs valuation process does not include freight or insurance costs in transporting goods from the place of export to the destination when calculating customs value. However, any inland freight or insurance costs incurred by the purchaser/importer before the goods leave the place of export must be included in the customs value.
- Independent Foreign Sales & Revenue Tax Registration for Merchants
- New Zealand Country Guide — Import and Landed Cost Reference
- Mexico Country Guide — Import and Landed Cost Reference
- United Kingdom — Import and Landed Cost Reference
- Australia Country Guide — Import and Landed Cost Reference
- Applicability of Extraterritorial US Export Control Laws