Do sole traders pay super, workers comp, BAS and GST?

Going out on your own as a tradie means nobody takes tax out of your pay, nobody pays your super and nobody insures you if you're hurt at work. So which of those are now your job? Here are straight answers to the questions sole traders ask most: do sole traders have to pay super, do they need workers comp, do they do a BAS, and do they pay GST.

Do sole traders have to pay super?

Not for yourself. The ATO says self-employed sole traders don't have to pay super guarantee for themselves. That also means nobody is saving for your retirement unless you do.

You can choose to make personal contributions from your bank account to your fund. Most people can claim a tax deduction for them until they turn 75, though conditions apply and there are yearly caps. A few things the ATO points out:

• Make sure your fund has your tax file number. Without it, contributions are taxed an extra 32% and the fund may not accept them.
• If you claim a deduction for a contribution, that contribution can't also get the government super co-contribution.
• Contributions over the yearly cap can attract extra tax.

When you do have to pay super

It changes once you pay other people. Employees, including family members working in the business, are generally owed super guarantee at 12% of their earnings. Workers under 18 qualify in any week they work more than 30 hours. Since 1 July 2026, under Payday Super, it is paid with each payday and generally has to reach the fund within 7 business days.

This one catches tradies out. The ATO says independent contractors paid mainly for their labour are eligible for super guarantee on the labour part of their invoice. That applies even if they quote an ABN. If you pay a subbie mostly for their time, check whether you owe them super. Our guide to hiring your first apprentice covers the employer side.

Do sole traders need workers comp?

Not for yourself, because it doesn't cover you. According to business.gov.au, sole traders aren't covered by workers compensation insurance. If you're hurt on a job, there's no policy paying your wages unless you've bought one. That's why business.gov.au suggests looking at personal injury, illness and income cover.

Yes, once you employ people. Workers compensation is run by each state and territory. The rules, thresholds and even the names differ, so check your own state's scheme. Some examples:

• Victoria: WorkSafe says a sole trader who doesn't employ anyone doesn't need to register. Generally you must register once you employ workers in Victoria, though there's an exception for businesses that pay no more than $7,500 a year in wages and have no apprentices.
• NSW: the NSW Small Business Commissioner says workers insurance is compulsory for all NSW employers unless you count as an "exempt employer". icare runs an online eligibility test if you're not sure.
• Queensland: WorkCover Queensland offers optional workplace personal injury insurance for self-employed people and contractors. It covers work injuries only, not 24 hours a day, and the minimum premium is listed as $1,650 a year including GST and stamp duty.

Do sole traders do a BAS?

If you're registered for GST, yes. A business activity statement is where you report and pay the GST you've collected, less the GST you've paid on business purchases. It also carries PAYG withholding if you have employees, and PAYG instalments if you're in that system.

If you're not registered for GST, you usually won't lodge a BAS for GST. But you may still pay tax during the year through PAYG instalments, and the ATO may send you an instalment notice instead of a BAS.

PAYG instalments: paying income tax as you go

Nobody withholds tax from a sole trader's income, so the ATO collects it through PAYG instalments. An individual is entered automatically when their latest tax return shows all three of these: instalment income of $4,000 or more, tax payable of $1,000 or more, and estimated tax of $500 or more. Most people pay quarterly.

In your first year there's usually no instalment, which means a big bill when you lodge your first return, and then instalments start on top. The ATO suggests new businesses think about joining voluntarily to spread the cost. Either way, put money aside from every invoice.

Do sole traders pay GST?

Only once you're registered. You must register when your GST turnover reaches $75,000. That's measured over rolling twelve-month periods, not the financial year, and you have 21 days to register once you're over. Our guide to when a tradie has to register for GST explains the tests and what registering late costs.

Once registered, you add GST to your prices and issue tax invoices. You also claim back the GST on materials, tools and fuel. Until you're registered, don't add GST or call your invoices tax invoices. Our page on what the ATO expects on a tax invoice has the details.

And income tax, every year

A sole trader's profit is their income. The ATO's tradie page says that if you carry on a business, you have to lodge a tax return even if it only earned $1. It also suggests sole traders lodge after 28 August, once payments reported by the businesses that paid you have been pre-filled. That reporting is the TPAR. To keep the bill down legitimately, read tradie tax deductions. If you're wondering whether a company would suit you better, see sole trader vs company.

A quick checklist

• Super for yourself: optional, but worth planning.
• Super for employees, and for subbies paid mainly for labour: required.
• Workers comp for yourself: it doesn't cover a sole trader. Consider personal injury or income cover, such as WorkCover Queensland's optional policy if you're in Queensland.
• Workers comp for employees: required under your state's rules.
• GST and BAS: once your turnover reaches $75,000, or earlier if you choose to register.
• Income tax: a return every year, plus PAYG instalments once you're in the system.

Every one of these is easier when you know what you've invoiced and what's been paid. BizzMate keeps your quotes, invoices and payments together, shows GST on its own line, and lets you download your reports as CSV or a spreadsheet for your accountant. Start a free trial, no card needed.

This guide is general information, not legal or financial advice. Super, workers compensation and tax rules depend on your circumstances and your state, so check the ATO and your state scheme, or speak to a registered tax agent.