GST on overseas software: check the subscription invoice

Start with the billing record for the software or digital service. Imported physical goods have a different documentation trail through customs. The accounting-software hub helps with choosing a product; this page deals with recording a subscription you've bought.

Identify who sold the subscription

Download the invoice from the billing account. The supplier may be an Australian company, an overseas company or a marketplace responsible for the sale. Match that entity to the invoice's tax details rather than using the app's logo or headquarters location.

Check the purchasing entity too. A subscription opened on a founder's personal account may show a personal name or consumer status after the business has changed. Give the supplier accurate ABN and GST-registration information where requested; an ABN alone doesn't establish GST registration.

The ATO international-transactions guide explains business versus consumer purchases and imported services. Some non-resident sellers use simplified GST registration, which differs from ordinary ABN registration. A missing ABN therefore needs investigation rather than an immediate conclusion about the supplier's compliance.

Compare three invoice patterns

These fictional documents are schematic examples, not replicas of any software provider's invoice. They show the evidence question, not an automatic tax-code answer.

Invoice pattern	Visible fields	Next step
A: Australian GST itemised	Example Software Australia; $100 plus $10 GST; named business purchaser	Check supplier registration, document validity and creditable business use before claiming
B: No GST shown	Example Cloud Overseas; US$70; ABN and GST status supplied	Confirm contracting entity and treatment; do not invent a GST component
C: Unclear tax line	Example Apps Marketplace; $100 plus $10 “tax”; no country or registration detail	Ask what tax was charged and who supplied the service; retain as unresolved

The same price can produce different bookkeeping questions. None of these examples proves a real purchase is creditable. Original ASBG worksheet; all example figures are fictional.

Foreign value-added tax or sales tax isn't an Australian GST credit. Likewise, if a vendor has treated a GST-registered business purchase as an Australian consumer sale, ask it to review the status and correct or refund an incorrect charge. Keep the original and revised documents.

Check the reverse-charge question

Under some offshore-purchase arrangements, the Australian buyer is responsible for GST through reverse charging. The ATO's reverse-charge section sets out both purchase conditions and connection-to-Australia circumstances. The ordinary rules include GST registration or required registration, a business purpose and use that is partly private or relates to input-taxed supplies. Other provisions can matter where consumer status has been misrepresented.

An invoice showing no GST doesn't close that question. Flag subscriptions used for mixed activities or private purposes, and ask the registered agent to determine whether reverse charge applies and whether any corresponding credit is available. Do not add 10% to every overseas bill or assume a fully offsetting credit in every case.

Save a decision for the next renewal

Maintain a subscription register with supplier entity, currency, tax-registration evidence, purchasing entity, intended use, agreed tax treatment and last review date. Link the invoice, including the currency and tax information, to each bank payment.

Revisit the decision when the supplier changes contracting entity, billing terms or tax treatment, or when your own registration or use changes. A remembered code from last year may no longer fit. Refunds, plan changes and credit notes need a link to the original purchase as well.

Keep the foreign-currency amount separate

The amount on an Australian card statement can include an exchange difference or bank fee. Keep the supplier invoice and payment conversion details instead of treating the entire card debit as the invoice price. If Australian GST is relevant, the GST amount must be supportable in Australian dollars.

Use the record-keeping guide for the document routine and the GST-code guide for basic distinctions. Neither replaces the transaction-specific checks above.

Continue with the next question

• Supplier charged GST but ABN Lookup says unregistered?
• Allocate GST credits across taxable and input-taxed sales

Key takeaways

• Read the invoice's supplier and tax details, not just the brand name.
• Verify buyer status and request a correction for an incorrect charge.
• Escalate reverse-charge and mixed-use questions before finalising the code.

Where to get help

Use the ATO international-transactions guide with a registered tax agent experienced in overseas purchases. Find related purchase-document guides in Bookkeeping and BAS.