Short answer: if you are not registered for GST, you pay 10% on top of every dollar you spend on Amazon ads, and you never get it back. Amazon adds Australian GST to the ad bill of any Australian advertiser without a GST registration. A KDP author can register voluntarily, even far below the A$75,000 threshold, and then claim that 10% back as GST credits. With A$1,000 of ads a month, the government keeps A$1,200 a year that could stay with you.
For Australian KDP authors, Merch on Demand designers and small sellers, from the GST Act, the Australian Taxation Office (ATO) and Amazon Ads' own pages, checked in October 2026. This is information, not tax advice: confirm your case with your accountant or BAS agent.
Work out what you lose with our free calculator
How much you lose each year
Australian GST is 10% (GST Act, section 9-70). Without a GST registration, it is a pure cost on your ads:
| Ads per month | GST per month | GST per year |
|---|---|---|
| A$300 | A$30 | A$360 |
| A$1,000 | A$100 | A$1,200 |
| A$3,000 | A$300 | A$3,600 |
Why Amazon charges you 10%
Amazon adds 10% GST to your ad fees, and without a GST registration you cannot claim it. Which Amazon company bills you depends on the marketplace your ads run on:
- amazon.com.au: Amazon Commercial Services Pty Ltd, an Australian company, registered for GST since May 1, 2017 (ABN Lookup). It adds 10% GST to your ad fees.
- amazon.com and the other marketplaces: an Amazon company outside Australia (Amazon Advertising LLC for amazon.com, for example). Amazon Ads' tax guide says it charges the tax of your country when you are "established in a country that has introduced ESS or remote services rules" and have "not provided Amazon with a valid VAT/GST registration number". Australia has such rules.
The Tax line at the bottom of your Amazon Ads invoice shows what you paid.
Can a KDP author register for GST?
Yes. Below A$75,000 of GST turnover you are not forced to, but you can. The GST Act: "You may be registered under this Act if you are carrying on an enterprise (whether or not your GST turnover is at, above or below the registration turnover threshold)" (section 23-10).
Your KDP royalties are what make it pay:
- What you sell Amazon is a right. Under the KDP agreement, you grant Amazon a "nonexclusive, irrevocable, right and license to print" and distribute your book. Your royalties are the price of that right.
- You sell it to Amazon companies outside Australia. The KDP agreement pays royalties through "the Amazon party that made the sale (or whose affiliate made the sale)". Its parties include Amazon.com Services LLC and Amazon Australia Services, Inc., neither of them an Australian company.
- So your royalties are GST-free. The GST Act makes GST-free a supply "made in relation to rights" to "an entity that is not an Australian resident and is outside the indirect tax zone" (section 38-190, item 4). That is exactly your case: you charge no GST on them.
- GST-free sales keep your GST credits. You only lose credits on purchases that relate to "input taxed" supplies or are private (section 11-15). GST-free royalties are neither, so the GST on your ads comes back to you.
The ATO has never ruled on KDP royalties as such: if you want that in writing before you register, ask it for a private ruling on your case.
What changes once you are registered
- Register for GST with the ATO (you need an ABN).
- Add your ABN to Amazon Ads. As a KDP author: Administration, Billing, Payment Settings, then the Tax info section.
- amazon.com.au ads: Amazon Commercial Services still shows 10% GST on the invoice. You claim it back as a GST credit on your BAS or GST return.
- Ads on other marketplaces: with your ABN, Amazon normally stops adding GST. You have nothing to reverse charge: the GST Act only reverse-charges a business that does not acquire the service "solely for a creditable purpose" (section 84-5), and ads for your books are.
What it costs, and when it pays
Registering is not free:
- You stay registered for at least 12 months. The ATO: "If you choose to register, generally you must stay registered for at least 12 months." The Act lets you cancel on request only after 12 months (section 25-55).
- You report GST. Registered voluntarily under A$75,000, you can elect to report and pay GST once a year instead of every quarter (ATO, "Annual GST reporting").
- You keep tax invoices for every credit you claim.
Say software or a bookkeeper costs you A$600 a year (our assumption, not an official figure):
| Ads per month | GST claimed per year | Gain after A$600 |
|---|---|---|
| A$300 | A$360 | −A$240 |
| A$500 | A$600 | A$0 |
| A$1,000 | A$1,200 | +A$600 |
| A$3,000 | A$3,600 | +A$3,000 |
Below about A$500 of ads a month, registering costs more than it saves. Above it, the gap grows with every dollar you spend.
The limits you need to know
Nothing is refunded for the past. Count on the savings from your registration date on. Amazon refunds GST only with proof that "registration was active during the billing period".
If you sell to Australians yourself, you charge 10% GST on those sales. Once registered, books you sell at a market, from your website or to a local shop carry GST. For an author whose income is KDP royalties, this rarely bites. For an FBA seller who sells goods to Australian consumers, it can wipe out the gain. Prices unchanged:
| Per month | Not registered | Registered |
|---|---|---|
| Sales | A$5,000 | A$5,000, of which A$455 GST to pay |
| Ads | A$1,100 (with GST) | A$1,000 (GST claimed) |
| What is left | A$3,900 | A$3,545 |
That seller loses about A$355 a month by registering. Registering pays when your income carries no GST, which is the case of KDP royalties.
Merch on Demand: the same reasoning holds only if your Merch royalties, like KDP royalties, come from an Amazon company outside Australia. Check your Merch agreement with your accountant before you count on it.
Frequently asked questions
Do I charge GST on my KDP royalties once registered?
No. They are a supply of rights to a non-resident Amazon company outside Australia, which the GST Act makes GST-free.
Must I register once my turnover reaches A$75,000?
Yes. A$75,000 is the GST registration threshold: at or above it, registering is required, not optional (ATO, "Registering for GST").
Will Amazon refund the GST I already paid?
Only for billing periods when your GST registration was already active. Ads billed before your registration date are not covered.
I spend A$200 a month on ads. Should I register?
Probably not for this reason alone: you would claim A$240 a year, less than a typical bookkeeping bill. Run your own figures in the calculator.
Before you decide
Work out what you lose with our free calculator: enter your monthly ad spend, see the GST you pay each year and what registering would change. Then take the figure to your accountant.
Spending less on ads for the same sales helps too: see how much Sponsored Products ads cost and whether KDP authors can run Sponsored Brands ads. Authors elsewhere: New Zealand, Singapore, Canada.
Sources
- A New Tax System (Goods and Services Tax) Act 1999, sections 9-70, 11-15, 23-10, 25-55, 38-190 and 84-5, Federal Register of Legislation
- Registering for GST, ATO
- Annual GST reporting, ATO
- Exports and GST, ATO
- GST cross-border transactions between businesses, ATO
- Amazon Commercial Services Pty Ltd (GST registration), ABN Lookup
- Amazon Advertising Agreement ("Amazon Contracting Party", "Elected Country"), Amazon Ads
- Understanding taxes and regulatory fees on your advertising invoice, Amazon Ads
- Register your Tax ID and Tax refunds, Amazon Ads help
- KDP Terms and Conditions (the Amazon parties, royalties), Amazon KDP
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