Guide
How to calculate GST in Australia.
Two sums cover almost everything: multiply by 1.1 to add GST, divide by 11 to find the GST already inside a price.
The arithmetic
Adding GST to a price
GST is 10%. If you have a price before GST, multiply it by 1.1 to get the total to charge.
- $100 × 1.1 = $110, of which $10 is GST
- $250 × 1.1 = $275, of which $25 is GST
- $1,480 × 1.1 = $1,628, of which $148 is GST
Finding the GST inside a total
This is where people go wrong. The total is 110% of the original price, so the GST is one eleventh of the total, not one tenth. Divide by 11.
- $110 ÷ 11 = $10 GST, leaving $100
- $550 ÷ 11 = $50 GST, leaving $500
- $1,000 ÷ 11 = $90.91 GST, leaving $909.09
Taking 10% off a GST-inclusive total is the most common GST mistake in Australian bookkeeping. On a $1,000 invoice it is wrong by $9.09.
Why the wrong method fails
| Total | Wrong: 10% off | Right: divide by 11 | Error |
|---|---|---|---|
| $110 | $11.00 | $10.00 | $1.00 |
| $550 | $55.00 | $50.00 | $5.00 |
| $1,000 | $100.00 | $90.91 | $9.09 |
| $12,000 | $1,200.00 | $1,090.91 | $109.09 |
The cents
A round total rarely produces a round GST. $1,000 contains $90.909… of GST, which becomes $90.91 and leaves $909.09. Those two add back to exactly $1,000.
Calculate in whole cents and round once. Rounding each line of an invoice separately is how a long invoice ends up a cent away from its own total.
A quick mental check
To estimate the GST inside a price, take 9% of the total — close enough to sanity-check a figure. $550 × 9% = $49.50, against the true $50. Use the calculator when it has to be exact.
Calculation questions
How do I calculate GST in Australia?
Multiply by 1.1 to add GST. Divide by 11 to find the GST inside a total. GST is 10% and has been since 1 July 2000.
Why divide by 11 and not 10?
Because a GST-inclusive total is 110% of the original price. The GST is one eleventh of that total. Taking 10% off the total gives too much — on $1,000 it is out by $9.09.
How do I remove GST from a price?
Divide the total by 11 for the GST portion, then subtract it. $550 ÷ 11 = $50 GST, leaving $500 before GST.
What is 10% GST on $100?
$10. The total to charge is $110.
How much GST is in $1,000?
$90.91. The amount before GST is $909.09, and the two add back to exactly $1,000.