A Complete Guide on How to Sell Crafts Online in Australia

Step 4: Price your handmade crafts for profit

Underpricing is the #1 reason craft businesses stall. Price to cover costs, pay yourself, and leave profit.

Formula (ex-GST):

Materials + Labour + Overheads + Platform fees + Profit = Price

If GST-registered, add 10% GST at checkout.

Include:

• Materials: fabric, yarn, beads, paint, wood, labels.
• Labour: set an hourly rate (e.g., $25–$40/hr) and time each step.
• Overheads: packaging, shipping supplies, apps/marketing, electricity, tools wear.
• Platform fees: listing, transaction, payment gateway.
• Profit: target margin 20–40% (higher for premium/custom).

1-line example:
$12 (materials) + $30 (labour) + $5 (overheads) + $3 (fees) + $20 (profit) = $70 ex-GST (⇒ $77 inc GST).

Step 5: Know your tax and GST obligations

When you’re selling crafts as a business, the ATO expects you to stay on top of a few core obligations. 

When tax applies

Income tax:

• Sole traders pay tax at individual tax rates.
• Companies generally pay 25% if they’re a base-rate entity.

GST (10%):
You must register for GST once your turnover hits $75,000, or if you reasonably expect to reach that within 12 months.

PAYG instalments:
As your income grows, the ATO may ask you to make quarterly prepayments toward next year’s tax.

Hiring staff?
You’ll need to handle PAYG withholding and superannuation for employees.

BAS (Only If You’re Registered for GST)

If you register for GST, you’ll need to lodge a Business Activity Statement, usually every quarter. It’s simply how you report the GST you’ve collected and the GST you can claim back on business expenses.

Most small craft businesses use the cash method, which means you report GST when payments actually hit your account, not when you issue an invoice.

If that sounds overwhelming, don’t worry, BAS is one of the easiest admin tasks to outsource, and Sleek can handle all of it for you.

What Australian laws do I need to follow when selling crafts online? 

1. Australian Consumer Law (ACL): 

The Australian Consumer Law (ACL) applies to supplies made in trade or commerce, that is, when you’re acting as a business (including overseas businesses selling to Australian consumers). 

Genuine occasional hobby sales may fall outside the ACL. As a craft seller, you must make sure:

• Your products match your photos and descriptions
• They’re of acceptable quality and safe to use
• You honour customer rights to a repair, replacement or refund if an item arrives faulty, damaged, or not as described
• Your listings aren’t misleading, your photos, measurements, materials, and processing times must be accurate

Think of it as a simple rule: your product must be what you say it is, and your customer must get what they paid for.

2. Privacy law and data protection

If you collect customer details, like names, emails, addresses, or order information, Australian privacy rules can apply, even if the platform (Etsy, Shopify, PayPal, Instagram) processes the payment for you. 

Most online craft businesses need a simple Privacy Policy that explains what information you collect, how you use it, and how you keep it secure

Under the Privacy Act 1988, many small businesses with annual turnover of $3 million or less are exempt from the Australian Privacy Principles unless a specific exception applies (e.g., health services, trading in personal information, government contracts). If an exception applies, or if you opt in, you must have a compliant Privacy Policy. 

3. Intellectual property: Copyright, trademarks and designs

Your product designs, photos, artwork, brand name, and logo are all forms of intellectual property (IP) and protecting them becomes more important as your business grows.
At the same time, you must avoid infringing on someone else’s IP by using their designs, patterns, characters, or brand names without permission.

To stay compliant:

• Consider trademarking your shop or brand name as you scale
• Only use original designs, artwork, and photos in your listings
• Never sell items featuring copyrighted images, characters, or logos unless you have the legal rights or licence to do so

4. Product safety, labelling, and local regulations

No matter what platform you sell on, you’re responsible for making sure your products meet any Australian safety and labelling standards that apply. This is especially important for categories like children’s toys, candles, cosmetics, skincare, and anything used on the body or in the home.

• If your craft item is a cosmetic (e.g., soaps, balms, skincare), it must meet the Cosmetics Ingredients Labelling Mandatory Standard (ingredient list on the label) and comply with chemicals regulation (AICIS) or the TGA if it’s a therapeutic good. 
• Non-cosmetic crafts don’t have this specific ingredient-labelling requirement

Your products must be safe, properly labelled, and compliant with the standards for your category.

5. Fair work and employment law

If your craft business grows and you bring on staff or contractors to help with making, packing, or admin, you’ll need to follow Fair Work rules. This includes:

• Using proper employment or contractor agreements; 
• Awards set minimum pay and conditions for employees (not independent contractors). 
• Ensure you classify workers correctly, misclassifying contractors can amount to sham contracting, which attracts penalties

Even small, home-based businesses must comply once they start hiring.