I have had a company and am now down sizing to lower my overheads. I am in the building industry and will close my company and go back to a sole trader. I have my new abn and am thinking of not registering for gst as its probable that my turnover will be less than $ 75 k this year.
Now i realise that i will still pay gst on materials I use on the job and will pass the total cost for materials + gst + my labour cost , without gst. So i.e.
Cost of materials $ 6000 gst on them $ 600 My labour cost $ 5000 total for the job $ 11600
Now i cant claim back the gst on the materials of $ 600, but i can claim back $ 6600 of material cost at end of financial year.
Also I will appear more competative if I don't charge gst on my labour, this case $500.As my jobs are approx. 50/50 materials/ labour I am thinking this may be the way to go.
Also it costs me around $ 250-300 per quarter to get BAS done.
I Have looked up ATO web site but they don't really go into example showing labour/ material break down. Also i suspect they want everyone to be gst reg. as it brings more money in , more often.
