Every business journey is different, but generally if you’re just starting up it would be worth looking at registering for GST, why?
- You can claim back the GST paid on all the goods and services you bought, essentially 15% on buying all those things you need to get your business up and going.
- It gives you an element of legitimacy as businesses prefer the suppliers and contractors they work with to be registered for GST and are be able to provide them with a GST receipt on completion of services.
- In today’s world, you need to be able to know how your business is doing day in day out. Having the compliance “deadlines” for GST puts in multiple cut off points for you to reconcile your Xero account, otherwise you might leave it to the end of the year and have 1000’s of transactions to sort out, then need to spend hours to sort it all out. Instead of spending an hour or so throughout the year and knowing your Xero is up to date so you can make those vital business decisions when needed.
- Plus GST is only a consumption tax, so you are only paying GST where you are the end user.
There are also a few disadvantages to registering voluntarily, such as the increased compliance costs to complete the GST returns and you’ll need to pay
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