GST registration is one of the first compliance questions every AHPRA-registered locum faces when their contracting income starts to grow. The rule is straightforward in principle: once your GST turnover reaches $75,000 in a rolling twelve-month period, you must register for GST with the ATO. In practice, the healthcare sector adds a layer of complexity because many health services are GST-free, which changes what you charge, what you claim, and how you complete your Business Activity Statement (BAS).
This guide covers the threshold, the GST-free vs taxable distinction, BAS frequency, and what to watch for as a sole trader or contractor across all AHPRA professions.
This article is general information only and does not constitute personal financial or tax advice. Consult a registered tax agent for advice specific to your circumstances.
The $75,000 GST Registration Threshold
Under the A New Tax System (Goods and Services Tax) Act 1999, you are required to register for GST once your current or projected annual GST turnover reaches $75,000. This figure is calculated on your gross income from all ABN-earning activities, not your take-home pay. For a locum working across multiple agencies and direct-billing workplaces, every shift fee, procedural payment, and on-call allowance counts toward the threshold.
You must register within 21 days of your turnover reaching $75,000. Failing to register on time does not eliminate the liability: the ATO can assess GST on all sales made from the date you were required to register, even if you never collected it from your clients.
If your turnover is below $75,000, registration is optional. Some locums register voluntarily because it allows them to claim GST credits on business expenses such as professional indemnity insurance, medical equipment, and software subscriptions. The trade-off is the administrative obligation of lodging BAS returns.
GST-Free Health Services: What This Means for Your Invoices
The GST-free classification is one of the most misunderstood aspects of healthcare tax. GST-free does not mean the transaction is outside the GST system entirely. It means the supply attracts a 0% rate. If you are registered for GST, you still report GST-free sales on your BAS, but you do not add 10% to the invoice and do not remit GST on those sales. You can still claim GST credits on your business expenses.
Medical services rendered by medical practitioners (GPs, specialists, and some other registered doctors) are GST-free when the service is generally accepted in the medical profession as necessary for appropriate treatment of the patient. Services that attract a Medicare benefit are a strong indicator of GST-free status. Purely cosmetic procedures with no Medicare benefit, such as cosmetic-only laser treatments, are taxable.
Allied health services are GST-free when three conditions are met simultaneously:
- The service falls within a designated health category under the GST legislation. Physiotherapy, psychology, occupational therapy, nursing, dentistry, pharmacy, podiatry, and a range of other disciplines are listed categories.
- The practitioner holds registration, permission, or approval under state or territory law, or belongs to a recognised professional association with consistent national standards. For most AHPRA-registered locums, AHPRA registration itself satisfies this condition.
- The service is universally recognised within the profession as an indispensable component of appropriate treatment for the patient.
When all three conditions are met and you bill the patient directly, the supply is GST-free.
The Locum-to-Clinic Distinction: Where It Gets Complicated
The GST treatment of your locum fee can differ depending on who you are actually billing. When you work through an agency or bill a clinic directly for your time rather than billing the patient, the ATO's analysis focuses on the contracting structure.
If the clinic bills patients and you bill the clinic for your services, you are typically making a taxable supply to the clinic. The clinic makes the GST-free supply to the patient, but your fee to the clinic is a business-to-business transaction and attracts GST at 10%. In this structure, once you are registered for GST, you must add GST to your invoice to the clinic, collect it, and remit it on your BAS.
If you bill patients directly, your service may qualify as GST-free if the profession and treatment criteria above are met.
The practical upshot: locums who receive a sessional fee from an agency or a per-shift payment from a workplace should generally treat that fee as a taxable supply and invoice with GST once registered. Locums billing patients directly under a direct-billing arrangement may invoice GST-free if the health service conditions are satisfied. Given the significance of this distinction, verify your specific arrangement with a registered tax agent.
For a ready-to-use invoice template that handles both taxable and GST-free supplies correctly, see the Sessional invoice template tool.
BAS Lodgement: How Often and When
Once you are registered for GST, you must lodge a Business Activity Statement. Your default reporting cycle depends on your annual GST turnover:
- Quarterly for most locums: turnover under $20 million. Quarterly BAS returns are due on the 28th day of the month following the end of each quarter (with Q2, the October-December quarter, due 28 February).
- Monthly if your turnover is $20 million or more, or if the ATO directs monthly reporting, or if you voluntarily choose it. Monthly returns are due on the 21st of the following month.
For the vast majority of healthcare locums, quarterly lodgement applies. Miss a due date and the Failure to Lodge penalty begins at $364 per 28-day period, capped at $1,820 for individuals.
Your BAS covers GST collected on taxable sales, GST credits claimed on business purchases (PAYG withholding if you employ anyone, and PAYG income tax instalments). If all your income is GST-free you will still need to report the sales, but you will not remit GST on them and you will claim input tax credits on eligible expenses.
Watching the Threshold During the Financial Year
The $75,000 threshold is assessed on a rolling twelve-month basis, not just the financial year. If your combined locum income from July to May crosses $75,000, the obligation to register arises in May, not on 1 July. Keep a running total of your ABN income across every workplace, agency, and direct-billing arrangement throughout the year.
For locums approaching the threshold mid-year, the timing of registration matters. Registering before you cross the threshold means you charge GST from day one and avoid a retrospective liability. Registering after can mean the ATO considers you liable for GST on income you may have already spent.
How Sessional Helps
Sessional tracks your cumulative earnings across all shifts and sources in real time, so you can see when you are approaching the $75,000 threshold well before you cross it. The GST and BAS readiness dashboard flags your current position, summarises your taxable vs GST-free income split, and keeps a record of input tax credits across deductible expenses. When your BAS due date approaches, the platform surfaces the key figures you need to complete your return or hand to your accountant.
If you are working as a GP across multiple clinics, Sessional separates your direct-billing income from your agency-fee income so the GST treatment of each stream is clearly visible. See pricing to find the plan that fits your practice volume.
Sources
- ATO - Registering for GST
- ATO - GST and health
- ATO - Medical services (GST-free)
- ATO - Other health services (allied health GST-free conditions)
- ATO - Due dates for lodging and paying your BAS
- ATO - Monthly GST reporting (threshold $20 million)
- Voyage Financial - Locum tax obligations Australia (agency fee taxability)
- Bristax - GST and health services (three allied-health conditions)