Growing a business is an achievement. But growth also brings new compliance responsibilities, and one area where Australian businesses frequently fall behind is GST reporting. The Australian Taxation Office has recently flagged that a number of businesses have not updated their GST reporting and accounting methods after exceeding the relevant turnover thresholds.
According to a bulletin published by the ATO in April 2026, the ATO is moving some businesses to the correct GST reporting and accounting methods from 1 July 2026. Businesses affected will be notified, but you do not have to wait for the ATO to act. You can make the switch voluntarily now through Online Services for Business.
This article explains the two key turnover thresholds, what changes at each one, and how to make sure your GST reporting is correct before the ATO does it for you.
The Two Key GST Turnover Thresholds
The rules governing how you report GST depend on your business’s GST turnover, which is broadly the total value of your taxable and GST-free sales, excluding input-taxed sales. There are two thresholds that trigger changes to your reporting obligations.
Threshold 1: $10 million GST turnover. Once your GST turnover reaches $10 million or more, you must switch from Simpler BAS reporting to full BAS reporting, and you must account for GST on a non-cash (accruals) basis.
Threshold 2: $20 million GST turnover. Once your GST turnover reaches $20 million or more, you must report GST monthly instead of quarterly, and you must lodge your BAS online.
These are not optional changes. They are legal obligations that take effect once your turnover crosses the relevant threshold.
| GST turnover | BAS reporting method | GST accounting basis | Reporting frequency | BAS lodgment |
|---|---|---|---|---|
| Under $10 million | Simpler BAS (default) | Cash basis (optional) or non-cash | Quarterly (or monthly if chosen) | Paper or online |
| $10 million or more | Full BAS reporting (required) | Non-cash (accruals) basis required | Quarterly or monthly | Paper or online |
| $20 million or more | Full BAS reporting (required) | Non-cash (accruals) basis required | Monthly (mandatory) | Online only (mandatory) |
You can see the full breakdown of reporting options on the ATO’s GST reporting methods page.
What Is Simpler BAS and Why Does It Stop at $10 Million?
Simpler BAS is the default GST reporting method for businesses with a GST turnover of less than $10 million. Under Simpler BAS, you only need to report three pieces of GST information on your activity statement:
- G1: Total sales
- 1A: GST on sales
- 1B: GST on purchases
This is straightforward and does not require a detailed GST calculation worksheet. It was designed to reduce the administrative burden on smaller businesses.
Once your GST turnover reaches $10 million, Simpler BAS is no longer available. You must move to full BAS reporting, which requires you to report additional GST labels covering a more detailed breakdown of your sales, purchases, and GST amounts. According to the ATO’s quarterly GST reporting guidance, full BAS reporting gives the ATO more detailed information about your business’s GST obligations and entitlements.
| What full BAS reporting actually requires
Under full BAS reporting, you report all GST labels on your activity statement, rather than only the three summary labels used in Simpler BAS. This includes labels covering export sales, capital purchases, non-capital purchases, and specific categories of GST credits. If you also have obligations for wine equalisation tax (WET), luxury car tax (LCT), or fuel tax credits, these are also reported in full. |
Cash vs Accruals: What Changes at $10 Million
Alongside the shift to full BAS reporting, crossing the $10 million GST turnover threshold also requires a change in how you account for GST. Businesses below this threshold can choose between cash basis and non-cash (accruals) basis accounting. At $10 million and above, the non-cash basis becomes mandatory.
The difference between these two methods is significant and affects when GST liabilities and credits appear on your BAS.
| Cash basis (available under $10M) | Non-cash / accruals basis (required at $10M or more) |
|---|---|
| You report GST when you receive payment from a customer | You report GST when you issue an invoice, even if payment has not been received yet |
| You claim GST credits when you pay a supplier | You can claim GST credits when you receive a tax invoice, even before you pay the supplier |
| Better for managing cash flow in businesses with slower-paying customers | Creates obligations and credits earlier, requiring more active accounts management |
| Available for businesses with aggregated turnover under $10 million | Mandatory for businesses with GST turnover of $10 million or more |
According to the ATO’s guidance on choosing an accounting method, businesses with an aggregated turnover of less than $10 million can use either method. Most larger businesses must use the non-cash method.
What does this mean in practice?
If your business has been using cash basis accounting and you cross the $10 million threshold, the switch to accruals means:
- You will report GST on sales as soon as you issue an invoice, even if the customer has not yet paid
- You can claim GST credits on purchases as soon as you receive a tax invoice, even before you pay the supplier
- Your BAS will reflect outstanding receivables and payables rather than actual cash movements
This can have a meaningful effect on your cash flow, since GST on sales may become payable to the ATO before your customers have settled their invoices. Businesses approaching the $10 million mark should plan for this change in advance, not after the fact.
What Changes at $20 Million: Monthly Reporting
The second threshold is $20 million in GST turnover. At this level, quarterly GST reporting is no longer permitted. You must report and pay GST monthly, and your BAS must be lodged electronically through the ATO’s online services.
According to the ATO’s monthly GST reporting page, the BAS must be lodged and payment made by the 21st day after the end of each monthly reporting period. If the due date falls on a weekend or public holiday, the next business day applies.
For businesses that have been filing quarterly, this change significantly increases the frequency and administrative workload of BAS preparation. Wine equalisation tax, luxury car tax, and fuel tax credit obligations also shift to monthly reporting when this threshold is crossed.
| Voluntary monthly reporting is available to all businesses
Businesses with GST turnover under $20 million can also choose to report monthly, even though it is not mandatory. The ATO notes that voluntary monthly reporting can assist with cash flow management by spreading GST payments into smaller, more frequent amounts. It can also help keep records more current. See the ATO’s BAS due dates page for lodgment timetables. |
What Changes at Each Threshold: A Side-by-Side View
| When you cross $10 million GST turnover | When you cross $20 million GST turnover |
|---|---|
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Why Businesses Miss These Changes
It is more common than you might think for a business to cross one of these thresholds without updating its GST reporting. There are several reasons this happens:
- Growth happens gradually. A business that was comfortably under $10 million two years ago may have crossed the threshold without a formal review of its GST obligations.
- The ATO does not always notify immediately. The ATO uses your recorded GST turnover to determine your reporting method, and this figure may not always reflect your actual current turnover if you have not updated your records.
- Bookkeeping systems are not always reviewed alongside growth. A payroll or accounting software setup that worked at $5 million in turnover may not automatically flag that different GST rules now apply.
- The distinction between GST turnover and aggregated turnover is overlooked. Some businesses may have an aggregated turnover above $10 million but a GST turnover below it, or vice versa. These are different measures, and the rules apply to GST turnover specifically.
The ATO has now confirmed it is actively addressing this issue. According to its April 2026 bulletin on GST turnover, businesses that have exceeded the relevant thresholds but have not updated their methods will be moved to the correct reporting and accounting basis from 1 July 2026. Affected businesses or their tax professionals will be notified.
What Happens If You Have Been Using the Wrong Method?
If your business has been using Simpler BAS when full BAS was required, or reporting quarterly when monthly reporting was mandatory, you may have an obligation to correct past BAS lodgments. The practical impact depends on the extent and duration of the non-compliance.
In some cases, using the wrong method may mean you have understated or overstated GST liabilities. The ATO may require amended BAS lodgments and, depending on the circumstances, penalties or interest may apply for amounts that were reported incorrectly.
The earlier you identify and correct these issues, the better your position. Voluntarily switching before the ATO forces a change from 1 July 2026 demonstrates good faith and gives you more control over the transition process.
| What to review before 1 July 2026
Check your current GST turnover against the $10 million and $20 million thresholds. If you are near either threshold or have recently crossed one, confirm with your accountant whether your current BAS reporting method and accounting basis are correct. If they are not, make the switch voluntarily through Online Services for Business or by contacting the ATO on 13 28 66. |
How to Voluntarily Switch Your GST Reporting Method
According to the ATO’s guidance on when and how to report and pay GST, you can change your GST reporting method by:
- Logging in to Online Services for Business and updating your GST reporting settings.
- Calling the ATO on 13 28 66 to notify them of your current turnover and request the appropriate method change.
- Working through your registered tax agent or BAS agent who can make the change on your behalf.
The timing of the switch matters. If you change your reporting period early in a lodgment period, such as at the start of a quarter or a new financial year, the change generally takes effect immediately. Changes made mid-period typically take effect from the start of the next quarter or year.
If your GST turnover has reached $10 million or more, the ATO’s guidance on GST reporting methods confirms that when you contact them to update your turnover, they will move you to full reporting from the start of the next financial year.
Frequently Asked Questions
What is the difference between GST turnover and aggregated turnover?
GST turnover is broadly the value of your taxable and GST-free sales, excluding input-taxed sales and some other amounts. Aggregated turnover also includes the annual turnovers of entities connected with or affiliated with your business. The GST reporting thresholds apply to GST turnover specifically, but aggregated turnover is relevant to other concessions and thresholds.
What if my GST turnover fluctuates above and below $10 million?
Once your GST turnover reaches $10 million and you are moved to full BAS and accruals accounting, the ATO will generally keep you on the full reporting method. If your turnover subsequently falls below $10 million, you can contact the ATO to request a return to Simpler BAS. The ATO will then either move you to Simpler BAS from the start of your next tax period or place you on GST instalments if eligible. See the GST reporting methods page for details.
Do other tax obligations also change when I move to monthly GST reporting?
Yes. If your GST turnover reaches $20 million and you move to monthly BAS reporting, your obligations for wine equalisation tax, luxury car tax, and fuel tax credits also shift to a monthly reporting cycle. PAYG withholding can also be aligned with monthly reporting if you choose.
Can I switch to monthly GST reporting voluntarily before I reach $20 million?
Yes. Monthly GST reporting is available to any GST-registered business regardless of turnover. The ATO notes that it can help with cash flow by spreading payments into smaller monthly amounts. Contact the ATO or speak to your tax agent if you are considering this option.
What if the ATO notifies me that it is changing my method from 1 July?
If the ATO notifies you that it will be moving your business to the correct reporting method from 1 July 2026, you should take that notification seriously and review your accounts with your accountant. If there are historical BAS lodgments that were made under the wrong method, now is the time to identify and correct them before the ATO conducts its own review.
How JMB Consultants Can Help
Understanding which GST reporting method applies to your business and making the right changes at the right time is not always straightforward, particularly when your turnover is close to a threshold or fluctuates across financial years.
At JMB Consultants, we review our clients’ GST turnover regularly to ensure their BAS reporting method and accounting basis remain correct as their business grows. If you are unsure whether your business is using the right method, or if you have received a notification from the ATO about a reporting change, we can help you assess your position, make any necessary corrections, and prepare your business for the correct obligations going forward.
Contact JMB Consultants to discuss your GST reporting obligations with an experienced accountant.
Disclaimer: This article is intended as general information only and does not constitute legal or financial advice. GST rules are based on ATO guidance current as of May 2026. Individual circumstances vary, and you should seek professional advice tailored to your situation before taking action or changing your GST reporting method.