Tax Code Australia – A Simple Guide for Freelancers and Small Businesses
Published: November 8, 2025
Summary: Tax codes in Australia are short labels used to describe how GST applies to your transactions — taxable, GST-free, or otherwise. This guide breaks down what they mean, why they matter for your business, and how Invozee helps you stay compliant while creating tax-ready invoices.
What is a tax code in Australia?
A tax code in Australia helps identify how GST applies to a transaction. In bookkeeping systems, tax codes make it easy to calculate and report GST accurately for your Business Activity Statement (BAS). They’re essential for freelancers, small business owners, and anyone registered for GST.
Common GST tax codes explained
- T – Taxable sales (10%): Standard GST-applicable goods or services.
- A – GST-free: No GST charged but recorded for compliance.
- N – Non-taxable: Wages, donations, or payments not subject to GST.
- EXP – Export sales: Overseas transactions, generally GST-free.
Why tax codes matter for freelancers and SMEs
Using the correct tax code ensures your invoices, tax reports, and BAS submissions are accurate. Mistakes in tax coding can lead to under-reporting or over-reporting GST, which might trigger penalties or delays from the Australian Taxation Office (ATO).
How to apply the right tax code
- Identify whether your transaction is taxable, GST-free, or exempt.
- Apply the corresponding tax code in your invoicing tool or accounting software.
- Ensure your invoices clearly display GST and tax details if you are registered for GST.
- Keep records of each transaction for BAS and end-of-year reporting.
Create tax-ready invoices instantly
With Invozee, you can generate tax invoices online that include GST fields, business information, and automatic calculations. It’s ideal for freelancers and small businesses managing multiple clients or projects.
For advanced formatting and templates, visit FormatPilot, or use DueSignal to send polite payment reminders that integrate perfectly with Invozee invoices.
Learn more about invoicing and compliance
- How to Create an Invoice for Freelancers
- Invoice vs Receipt: What’s the Difference?
- Top 5 Free Invoice Templates for 2025
Frequently Asked Questions
Is a tax code the same as a tax file number?
No. A tax code is used for GST transaction classification, while a Tax File Number (TFN) is used for income tax identification.
Can I create tax-compliant invoices without an accountant?
Yes, using tools like Invozee you can create tax invoices instantly — even if you’re new to accounting.
How often should I update my tax codes?
Tax codes don’t change often, but always review them when ATO updates GST laws or you expand your business internationally.
Final thoughts
Understanding tax codes helps you stay compliant and confident when managing your finances. Whether you’re issuing GST-inclusive invoices or GST-free exports, Invozee keeps it simple. Start creating compliant invoices today and focus more on your work, not your paperwork.