How the GST deferral program can improve your cash flow

What is the GST deferral program?

When importing goods into Australia, depending on your commodity, the Australian Border Force (ABF) levy a 10% Goods and Services Tax (GST) at the border before releasing your cargo. The Deferred GST (DGST) scheme, administered by the Australian Taxation Office (ATO), allows eligible importers to defer this payment to their next Business Activity Statement (BAS).

Instead of tying up working capital at entry, you report the deferred GST and claim the corresponding input tax credit on the exact same monthly BAS. For most GST-registered businesses, this creates a net-zero cash outlay at customs—freeing up vital liquidity for core operations.

Who benefits the most?

The GST deferral program is a great solution for businesses that import goods regularly and want better cash flow management and cost control. It’s particularly useful for:

• Retailers and eCommerce businesses that import products from international suppliers. By deferring GST, they free up cash that can be used for inventory or other business needs.
• Manufacturers that rely on imported raw materials or components to keep production going. This allows manufacturers to maintain liquidity without the added pressure of paying tax upfront on imported goods.
• Wholesalers and distributors who manage large-scale imports. Delaying GST payments can provide the cash needed to cover operational expenses and avoid disruption in the supply chain.

These types of businesses often have complex supply chains, requiring careful cost management to stay competitive. The GST deferral program helps ensure that cash is available when needed, reducing financial strain at the point of import.

Eligibility criteria

To participate in the ATO's DGST scheme, your business must satisfy four core compliance requirements:

• ABN & GST registration: Hold an active Australian Business Number (ABN) and be registered for GST.
• Monthly BAS lodgement: Lodge your BAS monthly (quarterly lodgers must transition to monthly cycles).
• Electronic transactions: Lodge statements and pay all ATO liabilities electronically.
• Clean compliance record: Maintain an up-to-date record with no overdue ATO tax returns, unfiled statements, or outstanding tax debts.

Step-by-step implementation

1. Check your eligibility: Ensure your business meets the criteria for GST deferral, including monthly BAS lodging.
2. Consult your tax agent: Get tailored tax advice specific to your business. 
3. Apply online via the ATO: Submit the online application form through Online Services for Business. Once approved, you can start deferring GST on all future imports.‍
4. Integrate it into your financial strategy: Use the additional cash flow flexibility to improve your cost control, support supply chain management, and cover other operational costs more efficiently.

How we can help

Navigating tax deferral programs alongside international shipping requires precision. We recommend you consult with your tax agent—while GST deferral makes sense for many, it needs to be based on your specific business needs, as well as the reporting and payment structure of your organisation.

Once aligned, Explorate seamlessly connects digital freight management with customs clearance workflows. By automating DGST indicators on your import declarations, we eliminate border delays, reduce administrative friction, and help keep your operating cash right where it belongs—in your business.

Key takeaways

‍