GST grouping for related entities may save you time

Updated November 12th 2013

When related entities undertake transactions such as the sale and purchase of stock GST usually needs to be included in the transaction and a tax invoice issued. When there are many related party transactions this can create additional administrative work and can also have cash flow implications related to GST timing differences in the group. Business with related party transactions may be able to overcome these challenges by forming a GST group, which has these benefits:

  • No GST charged on transactions between group members.
  • No need to create invoices for group transactions.
  • GST for all members of the group is combined each period and included on a single activity statement.

Subject to eligibility requirements it may be possible to group individuals, trusts, partnerships, companies and superfunds. In broad terms eligibility rules are predominantly based around common ownership or family relationships. To discuss GST grouping further please contact us.