Small Business Exemption
Category: tax
VAT/GST exemption for businesses below a revenue threshold, varying by jurisdiction.
A small business exemption allows businesses below certain revenue thresholds to avoid VAT/GST registration and collection obligations. Thresholds vary by country: the UK exempts businesses below £90,000 turnover, Australia exempts those below AUD 75,000, and some EU countries have domestic exemptions. However, non-resident sellers may not qualify for these exemptions in many jurisdictions.
Examples
- • A UK seller with turnover below £90,000 can apply for VAT exemption, but they cannot reclaim input VAT on business purchases.
- • German non-resident sellers using FBA cannot use any small business exemption and must register from the first sale.
- • Australia's AUD 75,000 GST threshold applies to domestic businesses; overseas sellers selling via marketplaces often have lower or no threshold.