How we work it out
Materials get marked up first, since that percentage covers your own time and risk in sourcing them, not just the cost price. Labour is hours times your hourly rate. Add the marked-up materials to labour and you've got the subtotal, the number before GST. Add 10% GST on top for the figure a client actually pays, if you're registered.
Worked example: $800 in materials with a 15% markup comes to $920. Add 8 hours' labour at $85 an hour, $680, and the subtotal is $1,600. GST at 10% adds $160, for a $1,760 total quote.
Why mark up materials at all
A materials markup isn't profit stacked on profit, it's covering the real cost of being the one who sources them: driving to the supplier, waiting in the queue, carrying the risk if something's faulty or short-delivered, and financing the purchase until the client actually pays the invoice. Most Australian trades mark up materials somewhere between 10% and 20%, with plumbers and electricians often at the higher end given how often a small part turns into an extra trip. Charging cost price on materials while only billing for labour quietly works out to a lower effective hourly rate than the one you think you're charging.
Whether GST belongs on the quote
GST registration becomes compulsory once your business turnover reaches $75,000 a year, and the Australian Taxation Office gives you 21 days to register from that point. Once registered, the 10% has to go on every taxable sale, it isn't optional or negotiable per job. Below that turnover threshold, registration is optional, and the subtotal before GST is the number that actually applies. This is general information, not tax advice, check your own registration status against the ATO's current rules before quoting.
Common questions
How much should I mark up materials on a quote?
Most Australian trades mark up materials somewhere between 10% and 20%, covering the time and risk of sourcing them, not just adding profit on profit.
Do I have to add GST to a job quote?
Only if you're registered for GST, which becomes compulsory once turnover hits $75,000 a year. Below that, registration is optional and the subtotal before GST is what applies.
What's the difference between the subtotal and the total?
The subtotal is marked-up materials plus labour, before GST. The total adds 10% GST on top, the figure a registered business actually charges a client.
Sources
Electricity rates: AER Default Market Offer (NSW, SA, south-east QLD), Victorian Default Offer, and each remaining state's regulated tariff, current for 2026–27. Appliance figures: the energyrating.gov.au registration database (July 2026 snapshot). Methods and assumptions are described on each page.