If you are a new small business, the ATO are keen for you to know that you can start using the simpler BAS ahead of the full implementation on 1 July.
To start reporting GST using the simpler BAS, you need to have:
- Started your business and registered for GST on or after 19 January
- An annual turnover of less than $2 million.
With the simpler BAS, you only need to report:
- GST on sales
- GST on purchases
- Total sales
The ATO are urging new small businesses to take advantage of this option and simplify your GST bookkeeping and reporting before simpler BAS becomes the default GST reporting method for all small businesses later this year.
In order to find out more about this offer, see Simpler BAS to find out how to take advantage of this offer visit the ATO’s web page: www.ato.gov.au/Business/Business-activity-statements-(BAS)/Goods-and-services-tax-(GST)/Simpler-BAS/
Owners of new small businesses should also familiarise themselves over when they should, and shouldn’t, be charging GST.
If you are registered for GST, most of your sales in Australia will include GST. Sales which include GST (taxable sales) are:
- made for payment (monetary or other)
- made in the course of operating your business (including any capital assets sold)
- connected with Australia
For these taxable sales, you:
- include GST in the price
- issue a tax invoice to the buyer
- pay the GST you’ve collected when you lodge your activity statement
You do NOT include GST in the price of goods and services that are:
- GST free – such as most basic foods, some education courses and health care products and services.
- Input taxed – such as lending money and renting out residential premises.
Claiming GST credits
You can claim a credit for any GST included in the price of goods and services that you purchase for your business and use to make either taxable or GST-free sales. This is called a GST credit.
You can’t claim a GST credit for the GST included in the price of purchases you use to make your input taxed sales.
Inside Small Business
