Tax & Accounting
Accounting for GST
What is GST?
Goods and services tax (GST) is a broad-based consumption tax charged at the rate of 10% on the sale of most goods and services and other things in Australia.
GST is charged at each step in the supply chain, with registered businesses including GST in the price of goods and services they sell.
For GST, a sale or supply includes a sale of goods, lease of premises, hire of equipment, giving advice, export of goods, and supply of other things. A purchase includes an acquisition of goods or services such as trading stock, a lease, consumables and other things.
Do I have to register for GST?
You must register for GST if you are in business and your annual turnover is at or above the registration turnover threshold of $50,000 per year.
You may choose to register if the turnover of your enterprise is below the registration turnover threshold.
Accounting for GST
You are required to pay the GST you collect to the Tax Office on a regular basis The total amount you must pay the Tax Office is reduced by the amounts of GST credits you can claim for things you bought for your business. You report it on a Business activity statement.
You account for your GST obligations on the Business activity statement at the end of each tax period. As a small business you normally have quarterly tax periods (because your annual turnover is less than $20 million) but you can choose to have monthly tax periods.
GST and cash flow
If you report and pay your GST quarterly you may like to consider whether you would prefer to report and pay monthly instead. Monthly tax periods may suit you if you are likely to claim regular GST refunds or to help prevent you from spending GST you have already collected.
S.O.S Accountants can help. Call us on 02 9588 9588 or Contact Us via our online form to make an enquiry.