Are you confused about
the GST Refund?
Need the facts? Get them here!
All the facts on gst refunds, gst rebates and the gst rate. Get ACCURATE and up to date information on the GST. You cannot afford to leave this to chance. Get the facts now!
Basically the GST is a 10% tax imposed on the sale of most goods and services. It began in Australia on
1st July 2000.
This article has been contributed by Janna Fikh of Fletcher Tax Accountants.
The Facts on the GST Refund
The following notes are a quick introduction to GST. Avoid the traps! Common GST Errors are provided below for your reference. For any further specific advice or assistance in this field, please do not hesitate to contact Fletcher Tax Accountants for more information.
When to apply for GST
A business must register for GST if their turnover (not profit!) is over $75,000 and/or they provide taxi travel.
How do you get a GST Refund?
If GST claimed on your business expenses exceed GST collected from your income producing activities, a GST refund will be issued.
The reverse is also true, whereby if GST collected from income producing activities exceeds GST incurred on business expenses, a GST payment will be necessary.
How do you maximise a GST Refund?
Efficient record keeping systems and bank reconciliations. That simple! Complete and accurate records are beneficial two fold. Not only do they allow for the most accurate GST calculation but also avails the business proprietor to know its true business position at all times.
How long does it take to get your GST Refund?
Activity Statements, if electronically lodged, usually take up to 14 days to be refunded by the ATO.
Tip: Provide the ATO with your bank details as soon as you commence business for quicker refunds!
Made a mistake with your Activity Statement/s?
Lodging business activity statements are not set in stone. Should a subsequent error or omission be discovered, it would be advisable to amend the particular Activity Statement involved or seek an accountant’s advice as to any other form of action available.
If things go wrong
In the event of a desk audit (or an onsite examination), it is advisable to be as cooperative as possible with the ATO. The ATO officers must check on Activity Statements which are outside the normal limits for the particular industry you are trading in or where excessive refunds may be abnormal or suspicious.
If you find any mistakes whilst combining any information for the ATO, it is advisable to be up front and honest as soon as possible. Acting in good faith or on professional advice previously received is always taken into account in final ATO determinations.
Avoid Common GST Traps
Do not claim GST on any private/non business expenses
Do not claim the full GST on a private component of a business expense
GST must be added to the final price of your business output by 10% ie. A hairdresser charges $50 for a haircut. GST in the amount of $5 must be added to her invoice, hence a total of $55 must be charged to the customer
Check all default GST coding within your accounting software and/or spreadsheets
GST cannot be automatically claimed. No tax invoice – no GST claim
Make sure you claim GST per the correct accounting method. For example, if you are registered for GST on a Cash basis, only bring the GST into account when your tax invoice was actually paid or the business expense actually incurred NOT when you issued the invoice or placed an order for an expense
Government charges such as ASIC Filing fees, council and land tax are GST Free
GST is applicable on Merchant Fees but not on common bank monthly fees
No GST can be claimed on residential rental property expenses
No GST is applicable on wages and superannuation expenses
Asset finance – GST treatment varies depending on the type of finance obtained and accounting method selected (cash or accrual)
Disclaimer:
This Article is written in general and not intended as advice on any particular matter.
Fletcher Tax Accountants, its staff and contractors expressly disclaim all and any liability to any persons whatsoever in respect of anything done by any such person or entity in reliance, whether in whole or part, on this article. Please seek appropriate professional and specific advice before acting on any information in this article.
If you would like to contact Janna directly please email Fletcher Tax Acccountants
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