Australian GST and the $1,000 low value threshold for parcel imports

Australian GST on low value imported goods trips people up because the rule changed direction in 2018. Before then, small imports came in GST-free and the only question was whether you were under the threshold. Since 1 July 2018 there is no GST-free window for goods bought from overseas — instead, the AUD 1,000 low value threshold decides who collects the GST and when, not whether it applies. This page explains how that works, who is legally responsible at each point, and where parcel forwarders sit in the chain. It is general information; the ATO and Australian Border Force publish the binding versions.

The two sides of the AUD 1,000 low value threshold

Everything follows from a single test: is the customs value of the goods AUD 1,000 or less?

The rate is the standard 10% GST in both cases. What changes is the collection mechanism and the administrative overhead attached to it.

What "customs value" actually means

This is the detail that produces most of the surprises. The AUD 1,000 test is applied to the customs value of the goods, which is broadly the price paid for the goods themselves, not the total you paid at checkout. International transport and insurance are generally excluded from that figure, even though GST, once it applies, is calculated on a base that does include them.

So a $950 order with $120 shipping is a low value import, because the goods are under $1,000. A $1,050 order with free shipping is not. Two rules of thumb follow:

• Do not assume your checkout total is the number customs looks at.
• Do not assume shipping cost pushes you over the line. It generally does not, for threshold purposes.

Currency conversion matters too: the value is converted to Australian dollars at the exchange rate applying at the relevant time, so an order sitting just under the line in USD can land just over it.

Who is responsible for collecting the GST

For low value goods, the ATO puts the obligation on whichever of three parties is closest to the sale:

1. The overseas supplier, if it sells directly to Australian consumers and its Australian turnover exceeds the AUD 75,000 registration threshold. This is why large overseas retailers now add GST at checkout.
2. The electronic distribution platform (EDP), where the sale happens through a marketplace. The platform, not the individual seller, carries the obligation.
3. The redeliverer, where the goods are delivered to somewhere outside Australia and a separate business brings them in — which is precisely what a parcel forwarder does.

Only one of the three is liable for any given sale, and the hierarchy avoids double taxation. In practice this means GST can appear at any of three points: on the retailer's invoice, on the marketplace's invoice, or on your forwarder's shipping invoice.

How this applies to parcel forwarding

The redeliverer category exists because of exactly the scenario parcel forwarding creates. A US retailer sells you goods and ships them to a US address — as far as that retailer is concerned, it is a domestic US sale with no Australian connection, and it charges no Australian GST. The goods then enter Australia because a forwarder brings them in on your behalf.

A GST-registered redeliverer is responsible for collecting the 10% on eligible low value goods it redelivers. That is why GST usually appears on the forwarding invoice rather than at the US checkout, and why a forwarder needs accurate values from you — it is calculating a tax liability, not just a shipping quote. Our step-by-step guide to parcel forwarding from the USA walks through where in the process this lands.

One consequence worth planning around: consolidation combines the declared value of everything in the box. Several sub-$1,000 orders combined into one shipment can produce a single consignment above the threshold, which moves it into the full import declaration process. If you are close to the line, ask your forwarder whether shipping two boxes is cheaper overall than one.

Exceptions and special cases

• Tobacco and alcohol. These are excluded from the low value regime entirely. Duty and tax are assessed at the border regardless of value, and both are heavily restricted by carriers in any case.
• GST-free goods. Items that would be GST-free if sold in Australia — certain foods, some medical aids and appliances — remain GST-free on import. The classification is the same one that applies domestically.
• Business importers registered for GST. If you provide a valid ABN and confirm you are registered for GST, the supplier or redeliverer generally should not charge GST on a low value import, because you would claim it back. You then account for it yourself.
• Goods you already own. Personal effects being shipped home, and items returning after repair, follow different rules from a purchase — value is still declared, but the concessions differ.
• Gifts. There is no general gift exemption from GST on low value imports for goods sold and shipped commercially. Declaring a purchase as a gift to avoid tax is a false declaration.

What happens when a parcel goes over the threshold

Above AUD 1,000, the parcel needs a full import declaration lodged with Australian Border Force before release. At that point:

1. Duty is assessed according to the tariff classification and the country of origin, so a free trade agreement may reduce or eliminate it.
2. GST is calculated on the customs value plus transport, insurance and any duty.
3. An import processing charge applies, and the carrier or a broker usually adds a clearance fee.
4. The parcel is held until the declaration is lodged and the amounts paid.

The ABF publishes the current thresholds, processing charges and duty rates at abf.gov.au. Rates and charges change, so treat any figure you read elsewhere — including a summary like this one — as a starting point to verify rather than a quote.

Related references

If you are working out the total landed cost of a purchase, this page is one of three inputs. The other two are the shipping cost and, for parcels going the other way, the destination country's own thresholds:

• Customs de minimis thresholds by destination country — the equivalent rule for parcels you send out of Australia.
• CN22 and CN23 customs declaration forms — how the value you declare is actually recorded.
• Australia Post international postage rates — the transport side of the calculation.