The deferred GST scheme: paying import GST on your BAS instead of at the border

What problem does deferred GST solve?

Without deferral, an importer pays GST on each shipment before it’s released — often thousands of dollars per container — then waits until the next BAS to claim it back as a credit. For a business importing regularly, that’s a rolling amount of cash permanently tied up with the government.

The ATO’s deferred GST scheme closes that gap. The ATO describes it as allowing GST on taxable imports to be paid via your monthly BAS rather than to the Australian Border Force at the time of importation. Because an entitled business can claim the matching credit on the same BAS, the cash effect is often close to neutral.

Who is eligible?

The ATO lists these requirements. You need to:

• have an Australian Business Number (ABN)
• be registered for GST
• lodge and pay your BAS electronically
• lodge your BAS monthly rather than quarterly
• import goods for home consumption
• be up to date with tax returns, BAS lodgements and payments

The ATO also says you may be ineligible if your tax obligations are overdue, or if you or relevant persons have had certain court convictions or penalties within the past three years relating to taxation, customs, trade practices or fraud.

How does it show up on the BAS?

According to the ATO, deferred GST appears as pre-filled data at label 7A on your BAS. If you’re entitled to full GST credits on those imports, you claim the corresponding credit at label 1B. For a business that uses all its imports to make taxable or GST-free sales, the two often cancel each other out.

Without deferral	With deferral
Pay import GST before release	No GST at the border
Claim the credit on your next BAS	Deferred GST pre-filled at 7A
Cash tied up from clearance to BAS refund	Matching credit claimed at 1B on the same BAS
Duty paid at the border	Duty still paid at the border

What does deferral do for cash flow?

For a regular importer, deferral can remove the single most annoying cash outflow at the port. Consider a business clearing a container a month with around $6,000 of import GST each time (illustrative). Lodging quarterly without deferral, up to three months of import GST can be outstanding before the credits come back. With deferral, that money never leaves at the border.

It also shrinks the amount you need to borrow for each order. If you’re using a facility to fund border costs, deferral means you only need to cover duty, broker and port charges at clearance. Run your numbers both ways in the landed cost calculator — there’s a tick box for deferred GST.

What are the trade-offs?

• Monthly BAS. More frequent lodgement means more bookkeeping. For many importers, it’s worth it anyway because it speeds up other refunds.
• Staying up to date. Eligibility depends on keeping lodgements and payments current. Falling behind can put approval at risk.
• Duty still applies. You’ll still need cash for customs duty and clearance charges before goods are released.
• Not a funding source. It removes a timing gap; it doesn’t fund deposits, balances or the weeks it takes stock to sell.

Your accountant is the right person to confirm whether deferral suits your business.

What if I’m not eligible yet?

Plenty of importers aren’t — perhaps they lodge quarterly, are newly registered, or have a BAS or two outstanding. In the meantime, the GST has to be found at each clearance. A line of credit drawn at clearance and repaid when the BAS credit arrives is a neat fit; see import line of credit. Past credit issues and ATO debt are considered case by case, so an overdue BAS doesn’t automatically rule you out of funding. If that’s where you are, make an enquiry — no credit check to ask.

How do I apply?

The ATO provides an online form, “Application for approval to defer GST on imported goods (NAT 75136)”. Your accountant or customs broker can help with the application and with setting up your broker to lodge declarations under your deferral approval. Once approved, make sure your broker knows, so GST isn’t charged at the border by mistake.

Illustrative example

Illustrative only. A kitchenware importer lands two containers a month and has been paying about $11,000 of import GST at the border each month, then waiting for its quarterly BAS to claim it back. After moving to monthly lodgement and gaining deferral approval, import GST is reported at 7A and credited at 1B on the same monthly BAS. The business no longer needs to fund import GST at clearance, and reduces the limit it needs on its import facility.

Is deferral worth it for an occasional importer?

If you import once or twice a year, the paperwork of monthly lodgement may outweigh the benefit, and it can be simpler to fund import GST at the border and claim the credit on your next BAS. Deferral really earns its keep when imports are frequent or large, when you already lodge monthly, or when you’re an exporter receiving regular refunds anyway. Your accountant can compare the two approaches using your own import pattern.

Fund the rest of the order

Deferred GST takes care of one timing gap. The deposit, balance, freight, duty and sell-through period still need cash. If those are stretching you, start your Trade Loan enquiry. It takes a minute, doesn’t involve a credit check, and goes to one real person — not a panel of lenders. Please tell us accurately how often you import and your usual order size so we can match you properly first time.