I am currently not GST registered as last 5 years average income (sales) has been below 75,000 GST sole trader 75000 limit.
Sole Trader tax return 2022-2023:
Total Sales ..............................67,000
Cost of Sales and overheads...30,000
Taxable Income.........................37,000
Income tax payable:..................3,500
Medicare levy payable:.................740
Income after tax and medicare:....32,760
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However, this year has seen an increase in revenue:
Sole Trader projection for 2023-2024:
(as at 22 April 2024)
Total Sales .............................76,000
Cost of Sales and overheads..34,000
Taxable Income.......................42,000
Income tax payable:................4,500
Medicare levy payable:...............840
Projected income after tax and medicare:..36,660
As my projected income will be over 75,000, I now need to register for GST:
therefore:
GST on sales/income................7,600
GST on applicable outgoings...1,800
GST payable:...............................5,800
Income after tax, medicare and GST: 30,860
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I'm earning more but financially worse off!
From the figures above, I note that my income after tax etc will be higher if I limit my income to just under 75,000
Questions:
1) Should I close my shop and stop working (about mid May) so my total sales remains under 75,000
2) Have I missed something, or is there a more fair way to pay GST and not be penalised when one's income is just a little over the 75,000 limit.
Thank you for your time.
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