How to Set Up GST (10%) in Odoo

GST (Goods and Services Tax) is a 10% broad-based tax on most goods, services, and other items sold or consumed in Australia. If your business is registered for GST — mandatory once annual turnover reaches $75,000 ($150,000 for non-profits) — every invoice, bill, and transaction in Odoo needs to handle GST correctly. This guide covers the complete setup.

Step 1: Install the Australian localisation

The foundation of GST in Odoo is the Australia - Accounting module (l10n_au):

• Go to Apps and install "Australia - Accounting"
• This installs a pre-configured chart of accounts, GST taxes, and tax groups
• If you already have a database with a different localisation, you can still install l10n_au alongside it — but it's cleaner to start fresh

Step 2: Verify the GST tax records

Go to Accounting → Configuration → Taxes. The Australian localisation creates these GST taxes:

• GST 10% (Sales) — Applied to customer invoices. Collects GST on behalf of the ATO.
• GST 10% (Purchases) — Applied to vendor bills. Records GST credits you can claim back.
• GST Free (Sales) — For GST-free supplies (e.g., basic food, medical, education). Still reported on BAS but at 0%.
• GST Free (Purchases) — For GST-free purchases.
• Input Taxed — For input-taxed supplies (e.g., financial services, residential rent). No GST is charged and no GST credit can be claimed.
• BAS Excluded — For items outside the GST system entirely (e.g., wages, government charges).

Step 3: Configure tax accounts

Each GST tax needs to post to the correct balance sheet account:

• GST Collected (Sales) — Posts to a "GST Collected" liability account (e.g., 2-1710). This is what you owe the ATO.
• GST Paid (Purchases) — Posts to a "GST Paid" asset account (e.g., 1-1710). This is what the ATO owes you.
• The net of these two accounts is your BAS GST payable/refundable amount
• Go to each tax record → Definition tab → verify the Account field is set correctly

Step 4: Set default taxes

Configure default taxes so you don't have to select them manually on every transaction:

• Go to Accounting → Configuration → Settings
• Under Taxes, set the Default Sales Tax to "GST 10% (Sales)"
• Set the Default Purchase Tax to "GST 10% (Purchases)"
• These defaults apply when no tax is specified on a product or partner
• You can override the default on individual products (e.g., set a food product to "GST Free")

Step 5: Tax-inclusive vs tax-exclusive pricing

Australian consumer law requires prices displayed to consumers to be GST-inclusive. But B2B businesses often work ex-GST:

• On each tax record, the "Included in Price" checkbox controls this behaviour
• If checked: a $110 product line = $100 + $10 GST (price includes GST)
• If unchecked: a $100 product line = $100 + $10 GST = $110 total (price excludes GST)
• B2B businesses typically leave it unchecked (prices ex-GST)
• B2C/retail businesses should check it (prices inc-GST)
• You can have both — create "GST 10% Inc" and "GST 10% Exc" tax records and assign them to different product categories

Step 6: Set taxes on products

• Go to each product → General Information tab
• Set Customer Taxes (sales tax) and Vendor Taxes (purchase tax)
• Most products/services: GST 10%
• Basic food, medical supplies, education: GST Free
• Financial services, residential rent: Input Taxed
• If a product's tax fields are left blank, the default taxes from Settings apply

Step 7: Tax invoices and compliance

For a document to be a valid tax invoice under ATO rules, it must include:

• The words "Tax Invoice" (Odoo includes this by default on invoice templates)
• Your business name and ABN
• The date of issue
• A description of the goods or services
• The GST amount (or a statement that the total price includes GST)
• For invoices over $1,000: the buyer's name/ABN
• Verify your invoice template in Settings → Accounting → Customer Invoices → Invoice Layout

Step 8: Verify with a test transaction

• Create a test customer invoice with a $100 product at GST 10%
• Verify the invoice shows: Subtotal $100, GST $10, Total $110
• Confirm the invoice: check the journal entry debits Receivable $110, credits Revenue $100 and GST Collected $10
• Create a test vendor bill with GST 10% and verify GST Paid is debited correctly
• Run the Tax Report (Accounting → Reporting → Tax Report) and confirm both transactions appear

Common GST mistakes in Odoo

• Wrong tax on imported goods — GST on imports is handled differently (customs duty + GST). Use the "GST on Imports" tax if applicable.
• Forgetting to set taxes on expense products — If you create expense categories without purchase taxes, you won't claim GST credits on those expenses.
• Mixing up inclusive/exclusive — Confirm your pricing convention early. Switching later means repricing every product.
• Not using fiscal positions — If you sell to overseas customers, use a fiscal position that maps GST 10% → Export (GST Free) automatically.
• Manual journal entries without tax — Journal entries don't auto-apply taxes. If you're recording a taxable transaction manually, add the tax line explicitly.