App store platforms automatically account for Australian GST only for offshore sellers. For Australian developers, the stores are split: Apple uses an agency arrangement, so you still report GST from Apple's recipient-created tax invoices; Google Play leaves you to charge and remit GST yourself. Direct website sales are always your obligation. Reconcile each stream separately before lodging your BAS.
"Apple handles the GST" is one of the most common things we hear from app and SaaS founders. It is also only sometimes true. Since 1 July 2017, Australian GST law has applied to imported services and digital products sold to Australian consumers, and special rules shift GST collection onto large digital platforms in many cases.
The catch is that those rules were designed for offshore sellers. If your business is based in Australia, the outcome depends on your platform contract, and Apple and Google have chosen opposite approaches. Treating them the same is how BAS errors get made. In this guide, our SaaS and tech accounting team explains who accounts for GST in each scenario, and how to map it correctly in Xero.
Offshore seller: the platform usually remits GST. Australian developer: check the contract. Apple takes GST on through an agency arrangement (you report from its RCTIs); Google Play leaves GST with you. Direct website sales: always your obligation.
Source: ATO GST administration annual performance report 2024-25, Table 2.1.
An electronic distribution platform is an online service, such as an app store or marketplace, that lets merchants sell digital products or services to customers through it. A service is not an EDP if it only processes payments, provides internet access, or advertises products with a link to the merchant's own website.
The definition sits in section 84-70 of the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act). The Apple App Store and Google Play are the obvious examples, but the rules also capture marketplaces selling software, games, e-books, streaming content and similar digital products.
The exclusions matter just as much. According to the ATO's guidance for EDP operators, a service is not an EDP if it only provides a carriage service, access to a payment system or payment processing, or advertising that links customers to a merchant's website. A service does not become an EDP merely because it processes payments, so in a standard direct website sale the GST obligation remains with the merchant. The ATO's detailed view is set out in Law Companion Ruling LCR 2018/2.
When an overseas business sells digital products to Australian consumers through a platform like an app store, the platform operator is generally treated as the supplier and accounts for the 10% GST. The overseas seller does not report Australian GST on those sales, and they do not count toward its $75,000 registration turnover.
This is the central rule in section 84-55 of the GST Act. Where an inbound intangible consumer supply is made through an EDP, the operator, not the underlying merchant, is treated as the supplier. An inbound intangible consumer supply is broadly a supply of anything other than goods or real property to an Australian consumer, unless the thing is done wholly in Australia or supplied wholly through an enterprise carried on in Australia (section 84-65). You can read the full provisions in the GST Act on the Federal Register of Legislation.
The ATO confirms in its guidance for merchants that where the EDP operator is responsible for GST, those platform sales do not count toward the merchant's GST turnover. But if the same offshore seller also sells directly through its own website to Australian consumers, it may still need to register and charge GST on those direct sales once it crosses the threshold. We cover the domestic equivalent in our guide to GST for Australian e-commerce sellers.
One more nuance that matters for B2B SaaS: a customer is only an "Australian consumer" if they are an Australian resident who is either not registered for GST, or registered but not buying for their business (section 9-25(7) of the GST Act). A supplier can treat a customer as a business customer where it takes reasonable steps and holds the customer's ABN and a statement that they are GST-registered (section 84-100). This is why platforms and offshore sellers ask business buyers for ABN and GST registration details at checkout.
No. The platform rules automatically apply only to overseas sellers. For Australian-based developers, the platform takes on GST responsibility only if it has agreed in writing to do so, the sales are digital products or services, and the platform is GST-registered. Apple and Google have made different choices, so the answer depends on which store you sell through.
This is the point most app businesses miss. Sales by an Australian developer to Australian customers are made through an enterprise carried on in Australia, so they are not inbound intangible consumer supplies and the default EDP rule simply does not reach them.
Instead, section 84-60 of the GST Act allows an EDP operator to agree in writing to treat certain digital supplies made through its platform as if they were inbound intangible consumer supplies. The ATO confirms an operator can take responsibility for GST on sales by Australian-based merchants where the agreement exists before the sale and the operator is registered for GST. In other words, the legislation hands the decision to the platform contract. Your developer agreement and platform tax settings determine the outcome, which is why reviewing them is a core part of small business tax compliance for app businesses.
We help Australian app and SaaS businesses get platform GST right, from registration through to BAS lodgement.
Contact Us Today →Apple requires Australian developers to hold an ABN and be registered for GST before they can sell paid apps, even if their turnover is under $75,000. Apple then acts as the developer's agent: it issues tax invoices to customers in its own name and sends the developer recipient-created tax invoices for the deemed supplies the developer makes to Apple.
Apple's App Store Connect guidance for Australia states that Australia-based developers must provide their ABN and proof of GST registration. This is Apple's commercial requirement, and it applies regardless of whether you would otherwise need to register for GST under the ordinary $75,000 threshold.
The mechanics sit in Apple's Developer Program terms. The Australian exhibit to Schedules 2 and 3 provides that the developer and Apple Pty Ltd enter into an arrangement under section 153-50 of the GST Act. Under that arrangement, Apple is treated as making the supplies to end users, and the developer is treated as making corresponding supplies to Apple. Apple issues the customer-facing tax invoices in its own name and issues recipient-created tax invoices (RCTIs) to the developer.
The practical effect: you still report GST as an Australian developer, using Apple's RCTIs, and you must not double-count. You do not issue tax invoices to Apple or to end users; you report from the RCTIs and the financial reports Apple provides. In our experience working with startup and SaaS clients, the most common error is reporting GST on both the gross App Store sales and the RCTI amounts. If you are setting up from scratch, our startup accounting and advisory team can build the revenue workflow correctly from day one.
Developers located in Australia are responsible for determining, charging and remitting the 10% GST on Google Play paid apps and in-app purchases bought by Australian customers. Google only takes on that responsibility for developers located outside Australia, and only where the sale goes through Google Play's own billing system.
Google takes the opposite approach to Apple: same EDP rules, opposite contractual outcome for Australian developers. Google's Play Console tax guidance is explicit: for Australian customers buying from offshore sellers, Google sets, charges and remits the 10% GST; for developers located in Australia, the GST obligation stays with the developer.
Two further points from Google's tax responsibility guidance catch businesses out. First, where a customer pays through an alternative billing system rather than Google Play's billing, the developer is responsible for any GST due, wherever the developer is located. Second, if an Australian developer is not registered for GST, Google may charge 10% GST on the service fee the developer pays to Google, which makes the platform more expensive for unregistered sellers.
The takeaway for an Australian developer selling on both stores: your Google Play sales to Australian customers are your GST problem, your Apple sales run through an agency arrangement with RCTIs, and the two must be mapped differently in your accounting file.
A service does not become an electronic distribution platform merely because it processes payments. In a standard direct website sale, GST stays with the merchant: an Australian SaaS business must charge 10% GST on taxable sales to Australian customers once registered or required to be registered. Exports of services may be GST-free if specific conditions are met.
The GST Act carves payment systems out of the EDP definition, so in a standard direct sale through Stripe, PayPal or a Shopify checkout, the GST obligation stays exactly where it started: with you as the supplier under the ordinary taxable supply rules in section 9-5. Sales to overseas customers may be GST-free under the export rules in section 38-190, but this is conditional treatment, not an automatic exemption, and worth confirming before you switch off tax on foreign invoices.
This is where blended revenue models get messy. A typical Australian SaaS business might collect App Store subscriptions, Google Play subscriptions and direct Stripe payments at the same time, each with different GST treatment. Our e-commerce accounting team sees the same pattern with marketplace and direct-channel retailers, and the discipline is identical: treat each channel as its own revenue stream with its own tax logic.
Map each revenue stream separately in Xero before the BAS is touched. The table below summarises the usual position for an Australian GST-registered developer. Platform agreements can vary, so confirm your own terms and tax reports before relying on it.
Do not treat Apple and Google reports the same way. Apple uses a GST agency and RCTI model for Australian developers. Google Play leaves GST responsibility with Australian developers. Direct website sales remain ordinary taxable supplies unless the GST-free export rules apply.
| Revenue stream | Who accounts for GST | Practical treatment |
|---|---|---|
| Apple App Store, Australian customers | You, via the s.153-50 agency arrangement | Report GST based on Apple's RCTIs and financial reports. Do not issue your own invoices. |
| Google Play (Play billing), Australian customers | You, the developer | Set GST in Play Console, include sales at G1 and GST at 1A on the BAS. |
| Alternative billing in-app, Australian customers | You, the developer | Normal taxable supply rules apply; charge and remit 10% GST. |
| Platform sales to overseas customers | Depends on the destination country | Generally no Australian GST; platforms often handle foreign VAT or sales tax. Check payout reports. |
| Direct website sales (Stripe, Shopify, PayPal) | You, under normal GST rules | Charge 10% GST to Australian customers; exports may be GST-free if conditions are met. |
A few practical rules we apply when preparing app-business BAS lodgements:
Getting this wrong is not a trivial risk. The ATO's estimated net GST gap rose to $8.7 billion in 2023-24, and GST reporting remains a sustained compliance focus. Late or incorrect lodgement also attracts penalties, which we cover in our guide to late BAS lodgement penalties. Structured bookkeeping and professional BAS and IAS lodgement support keeps each stream clean before anything reaches the ATO.
Source: ATO GST administration annual performance report 2024-25, Table 2.2.
The EDP rules were built to shift GST collection onto large platforms for offshore consumer sales, and for offshore sellers they mostly do exactly that. Australian SaaS and app businesses should never assume Apple or Google remits GST on their behalf. The correct treatment turns on five things:
The safest practical approach: reconcile Apple and Google reports separately, confirm whether GST is included in RCTIs or merchant reports, and map each revenue stream correctly in Xero before the BAS is lodged.
We will review your platform agreements, tax reports and Xero mapping, and make sure every revenue stream is BAS-ready.
Schedule a meeting →Disclaimer: The information provided in this article is general in nature and does not constitute specific tax, legal, or financial advice. Platform terms and tax settings change, and the GST treatment of your sales depends on your circumstances and agreements. We recommend seeking professional advice tailored to your individual circumstances. 42 Advisory is a CPA firm and Registered Tax Agent.
Yes. Purchases of apps, in-app content and subscriptions by Australian consumers generally include 10% GST. Who remits that GST to the ATO depends on where the developer is based and which platform processed the sale.
Not in the way most developers assume. Apple acts as your agent under a section 153-50 arrangement: it issues tax invoices to customers and recipient-created tax invoices to you. You still account for GST as a registered Australian developer, based on Apple's RCTIs and reports.
For an Australian developer, yes. Google does not take GST responsibility for Australian-based developers, so your Australian Google Play sales form part of your GST turnover and count toward the $75,000 registration threshold along with your other Australian sales.
Exports of services and digital products can be GST-free under section 38-190 of the GST Act, but the treatment is conditional, not an automatic exemption. App store platforms usually handle foreign VAT or sales tax in the destination country. Confirm the treatment in your payout reports before relying on it.
No. A service does not become an EDP merely because it processes payments or provides access to a payment system. In a standard direct website sale through Stripe, PayPal or your own checkout, GST remains with you as the merchant under the normal taxable supply rules.