Home – New Forums Money matters Deregistering For GST Two Years In? Reply To: Deregistering For GST Two Years In?

#1087887
Rhys
Member
  • Total posts: 325
Up
0
::

Hi again Davey,

In that case there is (I think) one issue you need to consider above all other: who you sell to.

If you sell predominantly to businesses most (almost all) of these will be GST registered so will reclaim the GST you charge them – so they don’t care if you charge them $100 GST free or $110 GST inc, to them the cost of either is $100. Deregistering will save you a bit in accounting fees – although once again take a look at the advice profived by taxpert – but then you lose a bit because you can’t claim the GST on your phone bill, petrol, etc. Probably worth doing, but marginal.

If on the other hand you sell to individual consumers deregistering for GST adds an immediate 10% to your income. This is because your customers only see the price on the procuct they don’t get to reclaim the GST. Say you sell an item (now) for $110 including $10 of GST, once you deregister for GST you should still be able to sell the item for $110 but now all of that is revenue to you. You no longer get to cliam back the GST you are currently reclaiming on purchases but this (has to be) tiny in comparison.

Hope this makes sense, cheers, Rhys