How can I stay on top of my GST reporting requirements?

Getting a clear and balanced picture of the entitlements a business registered for GST means the business can claim for the GST proportion of expenses undertaken in the course of the business operations. Here's what GST means for your business.

What is GST?

The Goods and Services Tax (GST) is a broad based tax of 10 per cent, included in the price of a sale item to customers. By law, eligible businesses will need to register for GST, report and pay it to the Australian Tax Office on a regular basis (either monthly, quarterly or annually depending on your GST turnover).

Do I need to register for GST?

You need to register if your GST turnover is $75,000 or more per year or $150,000 or more for non-profit organisations. If you're an importer or provide taxi travel as part of your business, you must register regardless of GST turnover. Find out how to work out your GST turnover here.

How can I claim GST credits?
 
Registered businesses can claim back the GST they pay in the price of their business purchases. As a result businesses do not suffer the economic cost of the tax as GST is paid at each stage of the supply chain.

 In order to claim GST credits for purchase it is crucial to track all expenses; this means keeping accurate and valid documents such as cash register dockets, receipts or invoices to support claims. In some cases, business owners often pay for expenses out of their pocket with their personal credit card and fail to submit as expenses to the business for reimbursement or lose tax invoices. Remember, five years is the required time frame to keep all tax invoices and other GST records.

Useful advice to bear in mind...

It is important to note that GST is not your money. It belongs to the ATO and is basically in your possession for a short time before you must hand it over. If you're not careful, GST can cause problems for your cash flow.

It's a good idea for SMEs to create a separate bank account and regularly deposit the GST you've collected into it. Stay on top of your GST by putting 10 per cent of the funds that come into your business into that account. If you're involved in the day-to-day operations of your business, it's essential to record when your payment cycle is to meet your lodging requirements and keep GST under control. Otherwise, it may be advantageous to employ a qualified bookkeeper or accountant to assist you so that GST is reported and claimed correctly and on time. 

For further information, visit the ATO website .

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