Is GST payable on proceeds received from insurance payout

 Author: JayATO(Community Support)Community Support

9 Feb 2026

Hi @Amna,

No, you don't need to pay GST on the insurance payout you received for your stolen car, provided you correctly informed your insurer of your GST status when you took out the insurance policy.

The key point here is that the GST treatment depends on the information you gave your insurer when you arranged the policy. If you're registered for GST and told your insurer about your registration status and how you use the car for business, the insurer accounts for the GST component separately when they process your claim.

The payout letter may not show a GST breakdown because the insurer has already handled the GST reporting based on the information you provided them. This means you don't pay GST again on the payout amount you receive.

However, you may be entitled to claim GST credits for any purchases you make with the insurance payout. For example, if you use the payout to buy a replacement vehicle for your business and you're registered for GST, you can claim the GST credits on that purchase through your business activity statement.

If you're unsure about your specific situation or need help with reporting this in your business activity statement, you can contact us or speak with a registered tax or BAS agent.