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Simple Guide To GST In Australia

According to ATO, the Goods and Services Tax (GST) is a broad 10% tax on most goods, services and other items sold or consumed in Australia.

Is it mandatory for all companies to register for GST?

Not all companies need to register for GST. Businesses with annual sales of $ 75,000 or more must register for GST. It is their choice if annual sales are less than $ 75,000.

Does my company need to register for GST?

Your business must register for GST if your annual revenue is $ 75,000 or more. You have the choice to register or not if it is less than that.

If you are a taxi or driver and you are not employed by someone else, then you must: Register for GST – no matter how much you earn. Since the fares paid by passengers to taxi drivers or ride-sharing drivers include Goods and Services Tax (GST), they must submit a Business Activity Statement (BAS) every quarter.

How do I register for GST?

You can register online for GST (and also apply for an ABN) through the Australian Business Register (ABR) website (www.abr.gov.au). You can also register for GST through the Business Portal on the ATO website. If you are unsure of the process, you can also do it through a registered tax agent or accountant.

The ABR is the central registry of Australian business information, so not only can you get an ABN and register for GST, but you can also get a Business Tax File Number (TFN), which is a pay-as-you-go withholding (PAYG ) and register your company. name.

How much GST do I have to pay?

  • The current rate of GST is 10%. For example, if the price of goods and services is $ 10 (eg GST), the final price the customer pays is $ 11. The $ 1 difference is the GST and it must be paid to ATO.
  • When you buy supplies for your business, you are charged 10% in GST, which you can claim as credit. At the end of each GST period – usually quarterly but sometimes monthly – you should consider the GST you have accumulated on your sales, minus the GST you paid (the credits) for your purchases. The difference is the amount payable (or refundable if credits on purchases are higher than debits on sales). You do this by completing a business activity statement and paying the net GST to the ATO.

It is worth mentioning that if a company pays more GST for their stocks than for their actual collection of GST on sales, it is better to register for GST to reclaim GST credits.

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How to Report GST

Lodging Business Activity Statement (BAS) is the process of reporting periodically tax paid on supplies and tax received on sales of goods and services. All companies registered for GST are required to report all GST charged on the sale of goods and services and also the credits for the purchase of business supplies on their BAS and also their Pay As You Go (PAYG) – installments and PAYG withholding tax. If a business has revenues in excess of $ 20 million, it must complete a BAS on a monthly basis.

Is it mandatory to provide a VAT invoice with GST to the customer?

When you make a taxable sale in excess of $ 82.50 (including GST), your GST registered customers must receive a tax invoice to be able to claim the GST credit. If they ask for it and you don’t provide it at the time, you have 28 days from their request to give it to them.

What information should the tax invoice have?

All invoices must contain specific information. For sales of $ 1,000 or more, the following should be displayed:

  • the words ‘tax invoice’
  • the name of the seller and ABN
  • date of the invoice
  • name of buyer and ABN or address
  • a description of the items sold, quantity and price
  • the GST amount or if the total amount includes GST.

Invoices for less than $ 1,000 must include all of the above, but not buyer’s information.

Contact our tax agent, Numbers Pro, to learn more about GST and discuss how to properly use GST reporting, according to ATO terms.

For more information visit website https://www.numberspro.com.au/

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