Customs Duty & Import GST Calculator

How Australian customs duty and import GST work

When goods are imported into Australia, the Australian Border Force (ABF) assesses customs duty based on the CIF value: the Cost of the goods plus Insurance plus Freight to the Australian port. The general duty rate is 5% for most manufactured goods, though rates vary by tariff classification under the Harmonized System (HS code). Some goods attract 0% duty (e.g., most raw materials and many items under Free Trade Agreements). Others attract higher rates.

Import GST of 10% is then calculated on the customs value plus any duty payable. For GST-registered businesses, import GST is fully reclaimable as an input tax credit on your BAS. This means the permanent cost of importing is the duty amount only. The GST is a cash flow cost until you claim it back, which is why the Deferred GST Scheme exists.

Worked example: importing auto parts from China

A Perth wholesale distributor imports automotive accessories from a Guangzhou supplier. The shipment details:

• Goods value: US$28,000 (FOB Guangzhou)
• Exchange rate: 1 AUD = 0.65 USD → goods value AU$43,077
• Sea freight: AU$3,200
• Marine insurance: AU$320
• CIF value: AU$43,077 + AU$3,200 + AU$320 = AU$46,597

Under the China-Australia FTA (ChAFTA), the applicable duty rate for these parts is 0%. Without ChAFTA, the general duty rate would be 5%. The difference:

The FTA saves AU$2,330 on this single shipment. Over 20 shipments per year, that is AU$46,600 in duty savings. But the FTA rate only applies if you have a valid Certificate of Origin from the Chinese supplier. Without it, ABF applies the general rate.

Free Trade Agreements and preferential rates

Australia has FTAs with over 15 countries and trading blocs. The key agreements for importers:

• ANZCERTA (New Zealand): All goods at 0% duty
• ChAFTA (China): Most manufactured goods at 0% (phased in over 2015-2025)
• JAEPA (Japan): Reduced rates on vehicles, machinery, and electronics
• KAFTA (Korea): 0% on most manufactured goods
• AANZFTA (ASEAN): Reduced rates varying by product and origin country
• AUKFTA (UK): 0% on most goods since 2023
• AUSFTA (USA): 0% on most manufactured goods

To claim FTA rates, the goods must meet rules of origin requirements (typically manufactured or substantially transformed in the FTA partner country) and you must hold a valid Certificate of Origin or self-declaration. Your customs broker handles the paperwork, but your AP team needs to verify that the broker applied the correct duty rate on each shipment's import declaration.

The Deferred GST Scheme

The Deferred GST Scheme allows approved importers to defer payment of import GST from the time of importation to the next BAS lodgement. Instead of paying GST at the border (which ties up cash for weeks or months until you claim the credit), you report the GST on your BAS and claim the input tax credit in the same lodgement. The net cash outflow is zero.

Without the scheme, a business importing AU$500,000 of goods per quarter pays AU$50,000+ in GST at the border and waits until the next BAS to reclaim it. That is AU$50,000 of working capital locked up for 1-3 months. The Deferred GST Scheme eliminates this. Application is through the ATO and requires that you are GST-registered, lodge BAS on time, and have no outstanding tax debts.

How import invoices create AP complexity

Every import shipment generates multiple invoices with different GST treatments: the supplier's commercial invoice (no Australian GST), the freight forwarder's invoice (international freight is GST-free, domestic cartage carries GST), the customs broker's invoice (professional services carry GST), and the import declaration itself (import GST, which goes to a different BAS label than domestic GST).

Processing all of these under a single GST code produces errors on every shipment. The import GST and customs duties coding guide walks through how each invoice component should be coded in Xero and MYOB. For businesses processing 10+ shipments per month, automating this coding through AP automation removes the most common source of import-related BAS errors.

How to use this calculator

1. Enter the goods value in the supplier's currency and select the currency.
2. Adjust the exchange rate if needed (defaults are indicative only).
3. Enter freight and insurance costs in AUD to calculate the CIF value.
4. Select the applicable duty rate using country presets for FTA rates, or enter a custom rate for your product's tariff classification.
5. Review the full landed cost breakdown including the reclaimable GST credit amount.

Frequently asked questions

What is the Deferred GST Scheme?

It allows approved importers to defer payment of import GST to their next BAS lodgement instead of paying at the border. You report the GST and claim the credit on the same BAS, resulting in no net cash outflow. Apply through the ATO. Most businesses importing regularly should use this scheme.

How is customs duty calculated?

Duty is calculated on the CIF value (Cost + Insurance + Freight to the Australian port). The duty rate depends on the product's tariff classification under the Harmonized System and whether an FTA applies. General rates are typically 0-5% for manufactured goods. Use the Australian Border Force tariff classification database to look up the exact rate for your product.

Can I claim back import GST?

Yes, if you are GST-registered and the imported goods are for business use. Import GST is claimed as an input tax credit on your BAS. If using the Deferred GST Scheme, it is reported at label 7A. If paying at the border, it is claimed using the import declaration as evidence (not a tax invoice). Import GST goes to different BAS fields than domestic GST.

Do I need a Certificate of Origin to get FTA duty rates?

For most FTAs, yes. The Certificate of Origin (or a self-declaration, depending on the agreement) confirms the goods were manufactured or substantially transformed in the FTA partner country. Without it, Australian Border Force applies the general duty rate. Your customs broker should request this from your supplier before the shipment arrives.