Start-ups guide to GST

Starting up a new business can be both exciting and confusing. There are many reporting requirements and regulations to adhere to, and it can be hard to know where to begin! Let us help!

Do you need to register your business for GST?

You’ve just launched a new start-up business – congratulations! What’s next?

If you answer yes to any of the following you will need to register your business for GST:

Your business has or is likely to have a GST turnover of $75,000 or more
Your non-profit organization has a GST turnover of $150,000 or more
You provide a taxi or limousine travel (Including services like Uber, GoCatch, Didi or OLA) regardless of your GST turnover
You want to claim fuel tax credits for your business, regardless of your GST turnover

Otherwise, registration for GST is optional.

Note: You have 21 days to register for GST once you become aware that your GST turnover will go over the $75,000 threshold.

Don’t have an ABN yet? You can register for GST at the same time as applying for an ABN. If you would like a hand, our experienced team can apply for both on your behalf.

Okay. You’ve registered for GST.

Now what?

The following will become your go-to list in the early days of your start-up business. After a while, it will become second nature, but in the meantime:

You must include GST in the price of most goods and services you sell.
You need to claim GST credits for most business purchases you make.
You must lodge activity statements to report your total sales, GST on sales and GST credits.
You must issue tax invoices to your clients. A tax invoice is different from a regular invoice and it must include the:

Word “Tax Invoice”
Business name
Business ABN
Date the invoice is issued
Brief description of the items being sold including qty and price
GST amount (if any) payable – this can be shown separately or if it is exactly one-eleventh of the total price it can say “Total Price includes GST”
Tax invoices for sales of $1,000 or more need to show the buyers identity or ABN.

Accounting for GST in your business

As a GST registered business, you need to issue tax invoices to your customers, collect GST and send it to the ATO with your Business Activity Statement (BAS). There are a few ways you can make this easier to manage:

Use business accounting software to produce tax invoices and automatically generate reports of your GST liabilities and credits at BAS time
Put the GST you collect into a separate bank account
Businesses with an aggregated turnover of less than $10 million can take advantage of the cash accounting method to better align your GST liabilities with your business cash flow
Engage the services of a Qualified Bookkeeper and Registered BAS agent who will make sure your BAS is correct each time through correct coding of transactions, reconciling the GST, PAYG, wages payable, super payable, wages expense, super expense and ATO integrated client accounts.

What is a bookkeeping health check?

A Balanced Beans bookkeeping health check It is a high-level review of your accounting data-file. It allows us to make sure there are not any obvious set-up or transactional errors in your file to ensure you are meeting your BAS obligations.

Any further questions? Book a free meeting to discuss how we can help streamline your business bookkeeping, manage your payroll, complete your BAS and other tax-related requirements, and more.

Remember – as cloud bookkeepers we can help your businesses where ever you are based or we can meet face-to face if you are in Newcastle or the Hunter Valley.

All a bit confusing?

We understand that GST can be a bit daunting, so we have put together a start-ups guide to GST. It is full of helpful information that will assist you with understanding your GST obligations and how to code your transactions correctly.

If this all sounds a bit too much, and your time is better spent elsewhere, click here to book a free complimentary consult with us. We can discuss your current business situation, and explain how a bookkeeping health check can help get a clear understanding of your finances.