When can a small business claim GST credits?

Understand when a GST-registered small business can claim credits for GST included in its purchases.

Summary

A GST-registered business can generally claim a GST credit for the GST included in the price of goods and services it buys for business use. Credits are reported on the BAS or annual GST return.

What this means

To claim a GST credit, you generally need to be registered for GST, the purchase must include GST, and it must be for use in carrying on your business. For purchases costing more than $82.50 including GST, you generally need a valid tax invoice before claiming the credit.

If a purchase is partly private or relates partly to input-taxed supplies, the claim generally needs to be reduced. You cannot claim GST credits for purchases that do not include GST, including most purchases from suppliers that are not registered or required to be registered for GST. A four-year time limit generally applies to claiming GST credits.

Typical actions

  • Confirm you are registered for GST before claiming credits.
  • Keep tax invoices for all business purchases above the low-value threshold.
  • Apportion between business and private use where relevant.
  • Report credits in the correct BAS period.
  • Check the ATO’s guidance for special situations before making claims.

Official ATO sources

Last checked: 25 August 2026

Claiming GST credits
Main ATO hub for claiming GST credits.

When you can claim a GST credit
Explains when a GST credit can be claimed.

When you cannot claim a GST credit
Explains when a GST credit cannot be claimed.

Related questions

Important notice: Tax Clarity is an independent information tool. This page provides general information based on official sources. It does not provide tax, legal, financial, or accounting advice. Tax rules can change, and how they apply depends on your circumstances. For advice about your situation, speak with a registered tax agent or qualified professional.

Need help understanding this in plain English?

Try the Tax Clarity App for a plain-English answer.

Open Tax Clarity App

Related Questions