GST code cheat-sheet — GST · FRE · INP · N-T · CAP explained, with ATO sources

Last reviewed against current ATO guidance: 20 May 2026. Always confirm current thresholds, rates, and dates at ato.gov.au.

A note before we start: GST · FRE · INP · N-T · CAP are not ATO codes. They're shorthand used by Australian accounting software (MYOB, Xero, Reckon, QuickBooks Australia) that map to the GST treatments defined in the A New Tax System (Goods and Services Tax) Act 1999 (the GST Act). The ATO speaks in terms of taxable, GST-free, input-taxed and out-of-scope supplies, and the BAS form uses field labels G1–G19, 1A and 1B.

The five software codes are a useful day-to-day reference. The mapping to what the ATO actually requires you to report is where most coding errors start. Each section below cites the relevant ATO page so you can verify the current position yourself — this article was last reviewed on the date in the frontmatter, and tax law changes.

The five codes, mapped to ATO language

The first three (GST, FRE, INP) are real ATO categories with statutory definitions. N-T and CAP are software conveniences — the ATO doesn't define "N-T" as a code, but it does distinguish between transactions that are out-of-scope of GST entirely and those that are within scope but specifically treated. And "CAP" is a flag for purchase categorisation; it doesn't override the GST treatment of the purchase itself.

GST — taxable supplies and purchases

A taxable supply attracts the standard 10% GST. The ATO's working definition is on its taxable sales page. For a purchase to be coded GST in your software, the invoice from the vendor must show GST explicitly and the vendor must be registered for GST.

The vendor-registration trap. A vendor whose GST turnover is below the registration threshold is not required to register. The ATO sets this threshold at $75,000 per year for most businesses, and $150,000 for not-for-profits (Registering for GST | ATO). An unregistered vendor's invoice will have no GST line — coding it as GST and back-calculating a phantom GST amount is the most common first-year coding error and inflates your 1B (GST credits claimed) by the imagined amount.

The check: if the invoice doesn't show a GST line, don't invent one.

FRE — GST-free supplies

GST-free means the supply is genuinely zero-rated under the GST Act. The ATO's reference page is GST-free sales.

The main statutory categories are:

• Most basic food and beverages (s 38-2 of the GST Act). The distinction between "basic" and "prepared" food is where most coding goes wrong — bread is GST-free; a sandwich is taxable; raw ingredients are GST-free; a hot meal is taxable.
• Most health and medical services when provided by a registered practitioner and necessary for treatment of the recipient. Cosmetic procedures are taxable.
• Most education (school and tertiary tuition fees, course materials).
• Exports of goods and services from Australia.
• Some specialised categories: childcare, religious services, certain charitable activities.

The check: is the supply genuinely on a GST-free list under the GST Act, or is it just that GST didn't appear on the invoice? The latter is more often N-T (out-of-scope) than FRE.

INP — input-taxed supplies

Input-taxed (the ATO's word; "INP" is the software shorthand) is the GST status of financial supplies and residential rent. The ATO confirms on its financial supplies page that:

All financial supplies (such as lending money or the provision of credit for a fee) are input-taxed sales and do not have GST in their price.

Worked examples from the ATO's own list:

• Creating, maintaining and closing a customer's bank account (this is why bank fees are INP, not N-T)
• Lending money or providing credit for a fee
• Life insurance
• Dealing in debt, equity, unit trusts, partnership interests or futures contracts

The GST treatment of an input-taxed supply: no GST in the sale price, and you can't generally claim GST credits on purchases used to make the supply. There are exceptions for "reduced credit acquisitions" — partial credits — covered on the same ATO page if you handle financial-services clients.

The most common error: coding bank fees as N-T (outside the GST system) when they're actually INP (inside the system, just zero-rated for credit purposes). Both arrive at the same dollar effect for a non-financial-services client but the BAS form expects INP, not N-T.

N-T — out-of-scope of GST

"N-T" is the shorthand for transactions that are not supplies at all for GST purposes — meaning they fall outside the GST Act entirely. The ATO doesn't publish a "list of N-T transactions" because it's the residual category. Typical examples:

• Owner drawings and contributions (movements of equity, not supplies)
• Internal transfers between your client's own bank accounts
• GST and PAYG payments to the ATO themselves
• ATO penalties and most statutory fines
• ASIC annual review fees (a regulatory charge, not a supply for GST purposes)

The trap most often seen in audit: N-T gets used as a "I don't know" default. A client whose purchase mix is 60% N-T usually has a coding problem, not a genuinely-out-of-scope spending pattern. When you don't know, the safer default is to research it, not to silently put it outside the GST system.

CAP — capital purchases

CAP is a software flag rather than a GST treatment. A capital purchase is something with a useful life over 12 months — equipment, vehicles, fit-outs. The CAP code routes the purchase to G10 (Capital purchases) on the BAS rather than G11 (Other purchases). The GST treatment itself depends on the supplier:

• A capital purchase from a GST-registered supplier with GST on the invoice is still claimable as a GST credit — code as CAP and the GST code together (different software handles this differently; check yours).
• A capital purchase from an unregistered supplier has no GST credit.

Whether you can deduct the cost immediately depends on the asset value and your client's eligibility for the instant asset write-off. Per the ATO's instant asset write-off page:

For the 2023–24 to 2025–26 income years the relevant limit amount is $20,000.

Eligibility: aggregated annual turnover under $10 million, asset first used or installed ready for use between 1 July 2025 and 30 June 2026, the asset itself eligible (some categories excluded). Assets at or above $20,000 go to the small business general pool — depreciated at 15% in the first year, 30% in subsequent years.

Note on indexation and changes: the $20,000 threshold has been extended year-on-year by Treasury but is not automatically indexed. Always confirm the current threshold and end date at the ATO link above before coding a borderline asset in a new financial year.

The luxury car tax interaction

If your client buys a vehicle that exceeds the Luxury Car Tax thresholds, LCT applies in addition to GST on the portion above the threshold. Per the ATO's LCT page, the 2025-26 thresholds are:

• $91,387 for fuel-efficient vehicles
• $80,567 for all other luxury vehicles

The fuel-efficient threshold uses a tighter consumption definition from 1 July 2025 onwards (down to 3.5L/100km from 7L/100km). For vehicle purchases above these thresholds, LCT is a separate calculation outside the standard GST/CAP coding — usually flagged at the dealer invoice stage.

The 30-second decision rule

When you're not sure between two codes for a particular transaction:

1. GST vs FRE — pick GST and ask the vendor for a tax invoice. If they confirm they're unregistered, recode to FRE (or N-T as appropriate).
2. INP vs N-T — pick INP. Bank fees in particular are always INP.
3. CAP vs an expense code — apply CAP if the asset has a useful life over 12 months, regardless of whether it's above or below the instant write-off threshold. The threshold affects when you can claim it, not whether to flag it as capital.

Building the rules library is what makes this scale

The single highest-leverage practice habit on GST coding: the first time you correctly code a particular vendor or pattern, save it as a rule in your accounting software. Coding consistency across quarters is what makes BAS prep fast, and rule-based coding is auditable in a way that ad-hoc per-transaction decisions are not.

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This article was last reviewed against ATO guidance on the date shown in the frontmatter. GST thresholds, LCT thresholds and instant asset write-off limits change — always confirm the current figures at ato.gov.au before relying on a specific number. This article is general guidance, not specific tax advice; for client-specific questions, consult a registered tax agent.