Some businesses are making simple mistakes when reporting their Goods and Services Tax (GST). The Australian Taxation Office (ATO) reminds taxpayers to avoid the following common GST reporting errors:
- Transposition and calculation errors – these mistakes often happen when manually entering amounts, so it’s important to double-check all figures and calculations before submitting your Business Activity Statement (BAS)
- No tax invoice – you must keep tax invoices to be able to claim GST credits on business-related purchases
- Transaction classifications – it’s important to check what GST applies for each transactions; for example, transactions involving food may be GST applicable
- Errors in accounting systems – a system with one coding error can classify several transactions incorrectly
Correcting GST Errors
If you find a mistake made on a previous BAS, you can:
- Correct the error on a later BAS if the mistake fits the definition of a ‘GST error’ and certain conditions are met
- Lodge an amendment – the time limit for amending GST credits is four years, starting from the day after the taxpayer was required to lodge the BAS for the relevant period
- Contact us or alternatively, the ATO for advice
The benefit of correcting GST error on a later BAS is that you will not be liable for any penalties or General Interest Charge (GIC) for that error. The ATO says it is generally easier to correct a GST error on a later BAS than to revise an one. Revising an earlier BAS that contains an error can incur penalties or GIC.
Published on December 19, 2018 by Progue
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