Post on 29-Aug-2018
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Chapter 5:
BAS & IAS
INSTALMENT ACTIVITY STATEMENTS (IAS)
What is an Instalment Activity Statement? Individual taxpayers, trustees with business income, and businesses not registered for GST use the Instalment Activity Statement (IAS) to report and pay their obligations and entitlements relating to:
Pay As You Go (PAYG) amounts withheld from payments to others. PAYG instalments. Fringe Benefits Tax (FBT) instalments.
An IAS is a single form you complete and return to the ATO to report these obligations and entitlements. The IAS replaced a wide range of forms which businesses and certain people not in business had to complete to report their tax obligations and entitlements to the ATO before the introduction of The New Tax System on 1 July 2000. However, taxpayers will still need to lodge an annual income tax return and an annual fringe benefits tax return, if applicable.
Who should use an Instalment Activity Statement? All businesses and individuals with any of the above-listed tax obligations and entitlements must complete an IAS at the end of each reporting period. The IAS mainly applies to individuals with investment income such as rental income, dividends and/or interest, or to businesses with an annual turnover below the minimum $75,000 GST registration threshold. It is very important to recognise that the Instalment Activity Statement and Business Activity Statement are separate forms. The Instalment Activity Statement (IAS) is for those taxpayers who are not registered for the goods and services tax (GST), whereas the Business Activity Statement (BAS) is for taxpayers who are registered for GST. Also, if you have wine equalisation tax (WET) or luxury car tax (LCT) obligations you need to register for GST. Therefore, the ATO will then send you a Business Activity Statement (BAS) instead of an Instalment Activity Statement.
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Types of Instalment Activity Statement There are four types of IAS. These are:
IAS N - This document is for taxpayers who have elected to report and pay an annual PAYG income tax instalment.
IAS I - This document is for taxpayers with a PAYG tax withheld only (quarterly or monthly).
IAS B - This document is for taxpayers with a PAYG income tax instalment obligation only. Typical users include partners in partnerships and other individual taxpayers who report and pay PAYG income tax instalments quarterly.
IAS J - This document is for taxpayers with PAYG income tax instalment, PAYG tax withheld and FBT obligations. Use this document for your record keeping purposes.
How do you receive your Instalment Activity Statement? The ATO sends the IAS to taxpayers before they need to lodge it. The statement is personalised, with some parts already completed to save the taxpayer time and effort. Each activity statement has a unique document identification number, which is shown on the front of your IAS. The document ID is used by ATO systems to identify your activity statement during processing.
How often do you lodge your Instalment Activity Statement? The ATO will pre-print information on your IAS to show when you have to lodge and the period covered by the activity statement for each of your obligations. Businesses and individuals not registered for GST with any of PAYG instalment, PAYG withholdings of FBT obligations and entitlements need to complete an IAS either monthly, quarterly or annually. The following tables provide a general summary of how often you need to lodge your IAS: PAYG withholding amounts
Annual PAYG withholdings
Remittance due Report required to accompany payment
SMALL
Up to $25,000.
Quarterly: On or before the 21st of the month following the period end.
IAS quarterly.
MEDIUM
$25,000 up to $1m.
Monthly: On or before the 21st of the month following the period end.
IAS monthly.
LARGE
Over $1m.
Monthly: On or before the 21st of the month following the period end.
Payments and IAS must be lodged electronically.
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PAYG instalments
Annual PAYG instalments
Remittance due Report required to accompany payment
Individuals with notional tax of less than $8,000.
Quarterly: On or before the 28th of the month following the period end. i.e. 28 October, 28 February, 28 April and 28 July
IAS quarterly.
Individuals deriving primary production income or “special professional income”.
Quarterly: as above
IAS quarterly.
All other entities not using annual instalment.
Quarterly: as above
IAS quarterly.
FBT instalments FBT instalment. Quarterly:
On or before the 28th of the month following the period end. i.e. 28 October, 28 February, 28 April and 28 July
IAS quarterly.
When do you lodge your Instalment Activity Statement? You need to lodge your completed IAS by the date shown in the top right-hand corner of the front of your activity statement. Make sure you allow enough time for your activity statement and any payment to reach the ATO by the due date.
How do you lodge your Instalment Activity Statement? You can lodge your activity statement online via the Internet using the ATO's Business Portal or electronic commerce interface (ECI). These are both fast, convenient and secure ways to lodge your IAS. Registered tax agents and registered BAS service providers can help you prepare and lodge your activity statement. Most tax agents/BAS service providers can lodge your activity statement electronically via the electronic lodgment service (ELS). By telephone if you have nothing to report at any label on the IAS. The ATO’s telephone service accepts lodgments for activity statements that are up to six months overdue. Otherwise, you can mail your correctly completed IAS to the ATO using the pre-addressed envelope provided.
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When mailing your IAS, you must use the official form provided by the ATO. Many commercial accounting software products can produce a document very similar in appearance to the official activity statement. While this document is fine for purposes such as record keeping, it must not be mailed to the ATO as a substitute for the official form.
How do you work out how much you owe or are owed by the ATO?
In completing your IAS you work out a net amount which you either owe to the ATO or which the ATO owes you. These instructions will help you work out this amount correctly.
What amounts do you show on your Instalment Activity Statement?
When filling in your IAS show all amounts in Australian currency. For each amount to be shown on your activity statement, show only the whole dollar amount. Do not show the cents. For example, show $7,643.69 as $7,643. Do not write a minus sign (–) to show a negative amount on your activity statement.
How to pay
Mail your correctly completed IAS to the ATO and attach a cheque for any required payment.
The ATO also offers a range of convenient payment options, both in Australia and overseas.
These are:
BPAY® credit card (conditions apply) direct credit direct debit mail at Australia Post outlets from overseas – pay by BPAY®, direct credit or mail.
If you make a payment at Australia Post, or you pay electronically, you need to still send your completed IAS to the ATO either by mail or electronically.
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What is the penalty if I lodge my activity statement late? The penalty for lodging the activity statement late is one penalty unit ($110) for each 28 day period, or part of a period, that the activity statement is outstanding, up to a maximum of 5 penalty units ($550). For a business with an annual turnover between $1 million but less than $20 million, the penalty is multiplied by two. For a large business with an annual turnover of $20 million or more, the penalty is multiplied by five resulting in a maximum penalty of $2,750. The Commissioner also has the discretion to remit this penalty. The circumstances of a business, such as the amount of tax payable, the past record of paying tax and lodging tax forms, and the effort made by the business in trying to meet its tax obligations, will affect whether penalties are remitted and the extent of the remission.
What is the penalty if my activity statement is incorrect? If you make an honest mistake which results in a shortfall in the amount of tax properly payable, the ATO will only require that you adjust the activity statement to pay the correct amount plus a general interest charge. If the activity statement is incorrect because you made a false or misleading statement and this results in a shortfall in the tax paid, in addition to being required to pay the shortfall plus a general interest charge, you may be liable for a penalty. The amount of the penalty will vary depending on the cause of the shortfall amount.
The base penalty amount, which can be increased or decreased depending on whether there are aggravating or mitigating factors, is a percentage of the tax shortfall amount as follows:
25% where the mistake is caused by you not taking reasonable care.
50% where the mistake is caused by you being reckless, and,
75% where the mistake is caused by you intentionally disregarding the law. However, you will still have to pay interest on any understated tax or over-claimed credit.
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1. Reporting periods are either every one month or three months. An entity has a choice in relation to a monthly or three monthly tax period, however, monthly tax periods can be compulsory in some circumstances. If the entity’s annual turnover is below $20 million the entity’s tax periods will be generally for 3 months ending on 31 March, 30 June, 30 September and 31 December. However, an entity may elect to have one month tax periods.
2. Monthly tax periods are compulsory if:
The entity’s tax period turnover threshold is $20 million or more.
The entity has a history of not complying with taxation obligations.
The entity has a substituted accounting period for income tax.
The entity will be carrying on an enterprise in Australia for less than three months.
3.
Adjustment events.
Bad debts.
A change in the extent of the creditable purpose.
4. Examples of where adjustment events arise includes:
All or part of a supply or acquisition is cancelled (eg. goods are returned due to poor quality).
The consideration for a supply or acquisition is altered (eg. a volume discount is given).
A supply becomes, or stops being taxable.
An acquisition becomes, or stops being creditable.
A staff member makes an error calculating the GST liability or input credit.
5. GST tax periods:
A monthly period
A quarterly period An annual period may be used by entities with annual turnover of $2,000,000 or less that elect to pay the GST by instalments. There is limited choice as to which periods you may pay the GST. If monthly tax periods are not compulsory an entity may choose a quarterly period.
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6. G1 = (a) 4,400 +(b) 550 + (d) 660 + (f) 300 + (g) 60 + (h) 8,800 +(i) 4,400 +
(l) 2,200 + (m) 5,500 = $26,870. 7. b, e, g, h and j. 8. (i)
Receipts Amount incl GST
Item G1 Item G2 Item G3 Item G4
Sales of GST-free foods 11,000 11,000 11,000
Export Sales to USA client 5,000 5,000 5,000
Sales of food including GST 15,400 15,400
Interest received 20 20 20
Commercial rent received 4,400 4,400
Residential rent received 550 550 550
Sale of used vehicle 220 220
Sales returns: GST-free foods
-1,560 -1,560 -1,560
Loan raised 15,000
Capital contributed by partners
20,000
TOTALS 35,030 5,000 9,440 570
(ii) T1= 10,000 + 5,000 + 14,000 + 20 + 4,000 + 550 + 200 – 1,560 = 32,210
9. (a) T (b) T (c) T (d) T
10. G10 = 22,000 + 220 + 1,100 + 1,210 = 24,530 11. (a) T (b) T (c) F (d) T (e) T (f) T g) T h) T (I) T
(j) F (k) T (l) T
12. G10 = 2,500 – 200 + 1,200 + 5,000 = 8,500
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13. Trev’s Welding Works
Purchase $ Amount including GST
G10 G11 1B
Office expenses 220 - 220 20
Staff amenities (GST-free) 55 - 55
Purchase of plant 6,600 6600 - 600
Sale of old plant 55 - - -
Supplies all including GST 7,700 - 7700 700
Wages and salaries 6,200 - - -
Contractors fees including GST 550 - 550 50
Cleaner (not registered for GST) 400 - 400 -
Rates (GST-free) 110 - 700 -
TOTALS 6600 9695 1370
Rework Question 13 using a GST Calculation Worksheet.
G10 Capital purchases 6600
G11 Non-capital purchases 9695
G12 = G10 + G11 16295
G13 purchases for input-taxed sales
G14 Purchases without GST in the price
1225
G15 Est private use or non-tax deductible
G16 = G13+G14+G15 1225
G17 Total purchases subject to GST 15070
G18 Adjustments
G19 Total subject to GST after adjustments
15070
G20 & 1B GST on purchases 1370
14. Bob the Butcher.
W1 12,000
W2 3,825
W3 930
W4 120
W5 4,875
4 4,875
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15.
$ Amounts owing
to the ATO Amounts owed
by the ATO
GST on non-capital purchases 6,000 6,000
GST on capital purchases 2,000 2000
GST on sales 9,000 9,000
Luxury car tax payable 1,000 1,000
Fuel tax credits 500 500
FBT instalment 3,000 3,000
PAYG Income Tax Instalment 1,200 1,200
TOTALS 14,200 (8A) 8,500(8B)
Item 9 5,700 Payable
16.
T1 12,165
T2 8.2%
T11 997
5A 997
17.
(a) True
(b) False
(c) True
(d) True
(e) true
(f) false
(g) false
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18. Sales Worksheet
(1)
Adjustment
for sales
(2)
Amount for
sales
(before
change
occurred)
included at
G1
(3)
New
amount for
sales
(4)
Increasing
adjustment
Fill in this
column if (3)
is more than
(2).
Subtract (2)
from (3).
(5)
Decreasing
adjustment
Fill in this
column if (2)
is more than
(3).
Subtract (3)
from (2).
Cancellation of
a sale
775 0 775
Reduction in
amount of sale
due to discount
or rebate
360 11 349
Sale has
stopped being
taxable
Increase in
amount for a
sale
Sale has
become taxable
Total 1,124
Transfer these amount to line 1 of adjustments summary worksheet.
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Purchases Worksheet
(1)
Adjustment
for purchases
(2)
Purchase
price
(before
change
occurred)
included at
G10 or G11
(3)
Changed
purchase
price
(4)
Increasing
adjustment
Fill in this
column if (2)
is more than
(3).
Subtract (3)
from (2).
(5)
Decreasing
adjustment
Fill in this
column if (3)
is more than
(2).
Subtract (2)
from (3).
Cancellation of
a purchase
400 0 400
Reduction in
purchase price
due to discount
or rebate
1,200 1,120 80
Purchase has
stopped being
creditable
Increase in
purchase price
Purchase has
become
creditable
Total 480
Transfer these amount to line 2 of adjustments summary worksheet.
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Adjustments Summary Worksheet
Line Reason for adjustment Increase Decrease
Adjustments which you can work out using these
instructions
$ $
1 Adjustments for sales following
adjustment events
1,124
2 Adjustments for purchases following
adjustment events
480
3 Bad debts written off or recovered
4 Change in extent of creditable purchase
5 Goods used solely for private or domestic
purposes
Adjustments that may require more information
6 Insurance settlements
7 Company amalgamations
8 Sales of things used to make financial
supplies or used privately
9 Sales of going concerns
10 Other adjustments
11 Total A
480
B
1,124
If A is more than B, subtract B from A
and show amount at G7
If B is more than A, subtract A from B
and show amount at G18
644
Abbot’s Newsagency transfer the amount of $644 to G18 (adjustments) of their calculation worksheet.
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19. 47.
1A G1 – ( G2 + G3 )
11
1B G10 + G11
11
T1 G1 – 1A
W2 PAYG Withheld
1A 459,870 – ( 74,220 + 28,900) = $32,431
11
1B ( 151,595 + 41,080 +1,340 + 39,050 ) = $21,187
11
T1 459,870 – 32,431 = $427,438
W2 $14,200
( Note: Wages and salaries have been excluded from GST calculations, these are
reported separately in PAYG withheld ).
$ $ $ Sales 459,870 Exports 74,220 Other GST free 28,900 103,120 356,750 / 11 GST on Sales 32,432 add PAYG Tax Withheld 14,200 46,632 Capital Purchases 151,595 Non Capital Purchases 81,470 233,055 / 11 less GST on Purchases - 21,187 Amount Owing $25,445
$ G1 356,750
74,220 28,900
$459,870
G10 132,000
925 18,670
$151,595
G11 41,080
1,340 39,050
$81,470
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Amount
$
Sale
$
GST
Free Export
$
GST
Free
$
Input
Taxed
$
Taxable
Supply
$
Capital
Purchase
$
Non Capital
purchase
$
Taxable
Supply
$
Input
Taxed
$
GST
Free
$
Private
Use
$
Wages
$
PAYG
$
Sales 356,750 356,750 356,750
Exports 74,220 74,220 74,220
GST free sales 28,900 28,900 28,900
Capital purchases 151,595 151,595 151,595
Non-capital purchases 81,470 81,470 81,470
Wages 78,200 78,200
PAYG 14,200 14,200
Commissioners rate 5.90%
$459,870 $74,220 28,900$ $356,750 $151,595 $81,470 $233,065 $78,200 $14,200
G1 G2 G3 G4 G6 G10 G11 G12 G13 G14 G15 W1 W2
Account Details
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G1 Total sales (including any GST)
G1 $ 459,870 G1 on the BAS
G2 Export sales
G2 $ 74,220 G2 on the BAS
G3 Other GST-free sales
G3 $ 28900 G3 on the BAS
G4 Input taxed sales
G4 $
G5 G2 + G3 + G4
G5 $ 103,120
G6 Total sales subject to GST
(G1 minus G5) G6 $ 356,750
G7 Adjustments (if applicable)
G7 $ 0
G8 Total sales subject to GST
after adjustments (G6 + G7) G8 $ 356,750
G9 GST on sales
(G8 divided by eleven) G9 $ 32,432
!A in summary
on the BAS
G10 Capital purchases
(including any GST) G10 $ 151,595 G10 on the BAS
G11 Non-capital purchases
(including any GST) G11 $ 81470 G11 on the BAS
G12 G10 + G11
G12 $ 233,065
G13 Purchases for making
input taxed sales G13 $
G14 Purchases without GST
in the price G14 $
G15 Estimated purchases for private use
or not income tax deductible G15 $
G16 G13 + G14 + G15
G16 $ 0
G17 Total purchases subject to GST (G12
minus G16) G17 $ 233,065
G18 Adjustments
(if applicable) G18 $
G19 Total purchases subject to GST after
adjustments (G17 + G18) G19 $ 233,065
G20 GST on purchases
(G19 divided by eleven)G20 $ 21,188
1B in summary
on the BAS
Amount Due $11,244
GST amounts the ATO owes you from purchases
GST calculation worksheet
GST amounts you owe the ATO from sales
(If you want to use the calculation sheet method to work out GST amounts)
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Option 1: Calculate GST and report quarterly
Total sales G1 $ 459,870 OO
Does the amount shown Yes No
at G1 include GST?
(indicate with an X)
Export sales G2 $ 74,220 OO
Other GST-free sales G3 $ 28900 OO
Capital purchases G10 $ 151,595 OO
Non-capital purchases G11 $ 81,470 OO
Go to summary over the page to report GST on sales at 1A and
GST on purchases at 1B and then complete the PAYG sections
Business Activity Statement(Extract)
PAYG tax withheld
Total amounts withheld
(W2 + W4 + W3)W5 $ OO14,200
14,200
OO
OO
OO
OO
W3
$
$
W2
Write the W5 amount at 4 in summary below
78,200
Amount withheld where no
ABN is quoted
W1 $
Amount withheld from
payments shown at W1$
Total salary, wages and
other payments
Other amounts withheld
(excluding any amount
shown at W2 or W4
W4
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T1 = G1 - G9 459,870 – 32,432 = $459,870
PAYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
OR
Write the T11 amount at 5A in summary below
Reason code variation
T3New varied rate %
T4
$ 5.90% %
T1 x T2 (or T3) T11 $ 25,219 OO
T2
T1 $ OO427,438PAYG Instalment income
Summary
Amounts you owe the ATO
32,432
PAYG tax withheld
1A $GST on sales
or GST instalment
$
PAYG income tax
instalment
Deferred company/fund
instalment
5A
7
$
$
4
OO
OO
OO
OO14,200
25,219
1A + 4 + 5A +7 8A $ OO71,851
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20. Note: Wages and salaries have been excluded from GST calculations, these are reported separately in PAYG withheld
1A ( 89,140 - 19,140) = $6,363
11
1B ( 4,180 + 45,650 + 5,260 + 880 + 2,156 + 2,090 ) = $5,474
11
T1 G1 – 1A = $82,776
W2 PAYG Withheld = $6,900
G8 70,000 19,140
$89,140
G11 6,534 5,260 880 2,156
$14,830
Amounts the ATO owes you
Do not complete 1B if using GST instalment amount (option 3)
1B $ OO
Credit from PAYG income
tax instalment variation5B $ OO
21,188GST on purchases
1B + 5B 8B $ OO21,188
Payment or refund?
X Yes, then write the result of 8A minus 8B at 9. This amount is
Is 8A more than 8B? payable to the ATO.
(Indicate with an X)
No, then write the result of 8B minus 8A at 9. This amount is
refundable to you (or offset against any other tax debt you have).
Your payment or refund amount
PAYMENT
9 $ $50,663
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Amount
$
Sale
$
GST
Free Export
$
GST
Free
$
Input
Taxed
$
Taxable
Supply
$
Capital
Purchase
$
Non Capital
purchase
$
Input
Taxed
$
GST
Free
$
Private
Use
$
Taxable
Supply
$
Adjustments
$
Wages
$
PAYG
$
Cash Sales 70,000 70,000 70,000
GST free sales 19,140 19,140 19,140
Furniture & Fittings 4,180 4,180 4,180
Capital purchases 45,650 45,650 45,650
Non-capital purchases 5,260 5,260 5,260
GST free purchases 6,534 6,534 6,534
Wages 22,484 22,484
Other expenses 880 880 880
Stationery & supplies 2,156 2,156 2,156
Bad Debts 2,090 2,090
PAYG 6,900 6,900 6,900
$89,140 $19,140 $70,000 $49,830 $14,830 $6,534 $58,126 $2,090 $29,384 $6,900
G1 G2 G3 G4 G6 G10 G11 G13 G14 G15 G17 G18 W1 W2
Account Details
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G1 Total sales (including any GST)
G1 $ 89,140 G1 on the BAS
G2 Export sales
G2 $ G2 on the BAS
G3 Other GST-free sales
G3 $ 19,140 G3 on the BAS
G4 Input taxed sales
G4 $
G5 G2 + G3 + G4
G5 $ 19,140
G6 Total sales subject to GST
(G1 minus G5) G6 $ 70,000
G7 Adjustments (if applicable)
G7 $
G8 Total sales subject to GST
after adjustments (G6 + G7) G8 $ 70,000
G9 GST on sales
(G8 divided by eleven) G9 $ 6,363
!A in summary
on the BAS
G10 Capital purchases
(including any GST) G10 $ 49,830 G10 on the BAS
G11 Non-capital purchases
(including any GST) G11 $ 14,830 G11 on the BAS
G12 G10 + G11
G12 $ 64,660
G13 Purchases for making
input taxed sales G13 $
G14 Purchases without GST
in the price G14 $ 6,534
G15 Estimated purchases for private use
or not income tax deductible G15 $
G16 G13 + G14 + G15
G16 $ 6,534
G17 Total purchases subject to GST (G12
minus G16) G17 $ 58,126
G18 Adjustments
(if applicable) G18 $ 2,090
G19 Total purchases subject to GST after
adjustments (G17 + G18) G19 $ 60,216
G20 GST on purchases
(G19 divided by eleven)G20 $ 5,474
1B in summary
on the BAS
GST amounts the ATO owes you from purchases
GST calculation worksheet for BAS
GST amounts you owe the ATO from sales
( If you want to use the calculation sheet method to work out GST amounts )
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Option 1: Calculate GST and report quarterly
Total sales G1 $ 89,140 OO
Does the amount shown Yes No
at G1 include GST?
(indicate with an X)
Export sales G2 $ OO
Other GST-free sales G3 $ 19140 OO
Capital purchases G10 $ 49,830 OO
Non-capital purchases G11 $ 14,830 OO
Go to summary over the page to report GST on sales at 1A and
GST on purchases at 1B and then complete the PAYG sections
Business Activity Statement( Extract )
PAYG tax withheld
Total amounts withheld
(W2 + W4 + W3)W5 $ OO6,900
6,900
OO
OO
OO
OO
W3
$
$
W2
Write the W5 amount at 4 in summary below
29,384
Amount withheld where no
ABN is quoted
W1 $
Amount withheld from
payments shown at W1$
Total salary, wages and
other payments
Other amounts withheld
(excluding any amount
shown at W2 or W4
W4
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T1 = G1 - G9 89,140 – 6,363 = $82,777
PAYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
OR
$ OO82,777PAYG Instalment income T1
$ 4.20% %
T1 x T2 (or T3) T11 $ 3,477 OO
T2
Write the T11 amount at 5A in summary below
Reason code variation
T3New varied rate %
T4
BAS Summary
Amounts you owe the ATO
1A + 4 + 5A +7 8A $ OO16,740
$
$
4
OO
OO
OO
OO6,900
3,477PAYG income tax
instalment
Deferred company/fund
instalment
5A
7
6,363
PAYG tax withheld
1A $GST on sales
or GST instalment
$
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Amounts the ATO owes you
Do not complete 1B if using GST instalment amount (option 3)
5,4741B + 5B 8B $ OO
1B $ OO
Credit from PAYG income
tax instalment variation5B $ OO
5,474GST on purchases
Payment or refund?
X Yes, then write the result of 8A minus 8B at 9. This amount is
Is 8A more than 8B? payable to the ATO.
(Indicate with an X)
- No, then write the result of 8B minus 8A at 9. This amount is
refundable to you ( or offset against any other tax debt you have ).
Your payment or refund amount
PAYMENT
9 $ 11,266
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21.
1A ( 60,062 - 15,500) = $4,051
11
T1 G1 – 1A = $56,010
W2 PAYG Withheld = $2,300 ( Note: Wages and salaries have been excluded from GST calculations, these are reported separately in
PAYG withheld )
$ G8 44,562
15,500
$60,062
G11 22,600
$22,600
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Amount
$
Sale
$
GST
Free Export
$
GST
Free
$
Input
Taxed
$
Taxable
Supply
$
Capital
Purchase
$
Non Capital
purchase
$
Input
Taxed
$
GST
Free
$
Private
Use
$
Taxable
Supply
$Wages $
PAYG
$
Sales 44,562 44,562 44,562
Exports 15,500 15,500 15,500
Capital purchases 3,630 3,630 3,630
Non-capital purchases 22,600 22,600 22,600
Wages 10,500 10,500
PAYG 2,300 2,300 2,300
$60,062 $15,500 $3,630 $22,600 $26,230 $12,800 $2,300
G1 G2 G3 G4 G6 G10 G11 G13 G14 G15 G17 W1 W2
Account Details
Chapter 5: BAS & IAS
63
G1 Total sales (including any GST)
G1 $ 60,062 G1 on the BAS
G2 Export sales
G2 $ 15,500 G2 on the BAS
G3 Other GST-free sales
G3 $ G3 on the BAS
G4 Input taxed sales
G4 $
G5 G2 + G3 + G4
G5 $ 15,500
G6 Total sales subject to GST
(G1 minus G5) G6 $ 44,562
G7 Adjustments (if applicable)
G7 $ 0
G8 Total sales subject to GST
after adjustments (G6 + G7) G8 $ 44,562
G9 GST on sales
(G8 divided by eleven) G9 $ 4,051
!A in summary
on the BAS
G10 Capital purchases
(including any GST) G10 $ 3,630 G10 on the BAS
G11 Non-capital purchases
(including any GST) G11 $ 22600 G11 on the BAS
G12 G10 + G11
G12 $ 26,230
G13 Purchases for making
input taxed sales G13 $
G14 Purchases without GST
in the price G14 $
G15 Estimated purchases for private use
or not income tax deductible G15 $
G16 G13 + G14 + G15
G16 $ 0
G17 Total purchases subject to GST (G12
minus G16) G17 $ 26,230
G18 Adjustments
(if applicable) G18 $
G19 Total purchases subject to GST after
adjustments (G17 + G18) G19 $ 26,230
G20 GST on purchases
(G19 divided by eleven)G20 $ 2,385
1B in summary
on the BAS
Amount Due $1,667
GST amounts the ATO owes you from purchases
GST calculation worksheet
GST amounts you owe the ATO from sales
(If you want to use the calculation sheet method to work out GST amounts)
Solutions
64
Option 1: Calculate GST and report quarterly
Total sales G1 $ 60,062 OO
Does the amount shown Yes No
at G1 include GST?
(indicate with an X)
Export sales G2 $ 15,500 OO
Other GST-free sales G3 $ 0 OO
Capital purchases G10 $ 3,630 OO
Non-capital purchases G11 $ 22,600 OO
Go to summary over the page to report GST on sales at 1A and
GST on purchases at 1B and then complete the PAYG sections
Business Activity Statement(Extract)
PAYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
OR
Write the T11 amount at 5A in summary below
Reason code variation
T3New varied rate %
T4
$ 3.80% %
T1 x T2 (or T3) T11 $ 2,128 OO
T2
T1 $ OO56,011PAYG Instalment income
Chapter 5: BAS & IAS
65
T1 = G1 - G9 60,062 – 4,051 = $56,011
PAYG tax withheld
Write the W5 amount at 4 in summary below
12,800
Amount withheld where no
ABN is quoted
W1 $
Amount withheld from
payments shown at W1$
Total salary, wages and
other payments
Other amounts withheld
(excluding any amount
shown at W2 or W4
W4
W3
$
$
W2 2,300
OO
OO
OO
OO
Total amounts withheld
(W2 + W4 + W3)W5 $ OO2,300
Summary
Amounts you owe the ATO
4,051
PAYG tax withheld
1A $GST on sales
or GST instalment
$
PAYG income tax
instalment
Deferred company/fund
instalment
5A
7
$
$
4
OO
OO
OO
OO2,300
2128
1A + 4 + 5A +7 8A $ OO8,480
Solutions
66
Amounts the ATO owes you
Do not complete 1B if using GST instalment amount (option 3)
2,3851B + 5B 8B $ OO
1B $ OO
Credit from PAYG income
tax instalment variation5B $ OO
2,385GST on purchases
Your payment or refund amount
9 $ $6,095
Payment or refund?
X Yes, then write the result of 8A minus 8B at 9. This amount is
Is 8A more than 8B? payable to the ATO.
(Indicate with an X)
No, then write the result of 8B minus 8A at 9. This amount is
refundable to you (or offset against any other tax debt you have).
Chapter 5: BAS & IAS
67
22.
1A 19,800 = $1,800
11
1B ( 10,200 + 3,000 + 1,600 + 200 + 180 + 120 + 460 ) = $1,432
11
T1 G1 – 1A = $18,000
W2 PAYG Withheld = $760
( Note: Wages and salaries have been excluded from GST calculations, these are reported
separately in PAYG withheld ).
Account Details Amount
$
Sale
$
GST
Free
Export
$
Input
Taxed
$
Taxable
Supply
$
Capital
Purchase
$
Non Capital
Purchase
$
Sales 19,800 19,800 19,800
Capital purchases 10,200 10,200
Non-capital purchases 3,000 3,000
Rent 1,600 1,600
Cleaning 200 200
Phone 180 180
Stationery 120 120
Advertising 460 460
Wages 4,000
PAYG 760
$19,800 $19,800 $10,200 $5,560
G1 G2 G4 G6 G10 G11
Input
Taxed
$
GST
Free
$
Private
Use
$
Taxable
Supply
$
Wages
$
PAYG
$
10,200
3,000
1,600
200
180
120
460
4,000
760 760
$15,760 $4,760 $760
G13 G14 G15 G17 W1 W2
G11 3,000 1,600 200 180 120 460
$5,560
Solutions
68
G1 Total sales (including any GST)
G1 $ 19,800 G1 on the BAS
G2 Export sales
G2 $ G2 on the BAS
G3 Other GST-free sales
G3 $ G3 on the BAS
G4 Input taxed sales
G4 $
G5 G2 + G3 + G4
G5 $ 0
G6 Total sales subject to GST
(G1 minus G5) G6 $ 19,800
G7 Adjustments (if applicable)
G7 $ 0
G8 Total sales subject to GST
after adjustments (G6 + G7) G8 $ 19,800
G9 GST on sales
(G8 divided by eleven) G9 $ 1,800
!A in summary
on the BAS
G10 Capital purchases
(including any GST) G10 $ 10,200 G10 on the BAS
G11 Non-capital purchases
(including any GST) G11 $ 5560 G11 on the BAS
G12 G10 + G11
G12 $ 15,760
G13 Purchases for making
input taxed sales G13 $
G14 Purchases without GST
in the price G14 $
G15 Estimated purchases for private use
or not income tax deductible G15 $
G16 G13 + G14 + G15
G16 $ 0
G17 Total purchases subject to GST (G12
minus G16) G17 $ 15,760
G18 Adjustments
(if applicable) G18 $
G19 Total purchases subject to GST after
adjustments (G17 + G18) G19 $ 15,760
G20 GST on purchases
(G19 divided by eleven)G20 $ 1,433
1B in summary
on the BAS
Amount Due $367
GST amounts the ATO owes you from purchases
GST calculation worksheet
GST amounts you owe the ATO from sales
(If you want to use the calculation sheet method to work out GST amounts)
Chapter 5: BAS & IAS
69
Option 1: Calculate GST and report quarterly
Total sales G1 $ 19,800 OO
Does the amount shown Yes No
at G1 include GST?
(indicate with an X)
Export sales G2 $ 0 OO
Other GST-free sales G3 $ 0 OO
Capital purchases G10 $ 10,200 OO
Non-capital purchases G11 $ 5,560 OO
Go to summary over the page to report GST on sales at 1A and
GST on purchases at 1B and then complete the PAYG sections
Business Activity Statement(Extract)
PAYG tax withheld
Write the W5 amount at 4 in summary below
4,760
Amount withheld where no
ABN is quoted
W1 $
Amount withheld from
payments shown at W1$
Total salary, wages and
other payments
Other amounts withheld
(excluding any amount
shown at W2 or W4
W4
W3
$
$
W2 760
OO
OO
OO
OO
Total amounts withheld
(W2 + W4 + W3)W5 $ OO760
Solutions
70
PAYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
OR
Write the T11 amount at 5A in summary below
Reason code variation
T3New varied rate %
T4
$ 5.60% %
T1 x T2 (or T3) T11 $ 1,008 OO
T2
T1 $ OO18,000PAYG Instalment income
Summary
Amounts you owe the ATO
1A + 4 + 5A +7 8A $ OO3,568
$
$
4
OO
OO
OO
OO760
1008PAYG income tax
instalment
Deferred company/fund
instalment
5A
7
1,800
PAYG tax withheld
1A $GST on sales
or GST instalment
$
Chapter 5: BAS & IAS
71
T1 = G1 - G9
19,800 – 1,880 = $18,000
Amounts the ATO owes you
Do not complete 1B if using GST instalment amount (option 3)
1,4331B + 5B 8B $ OO
1B $ OO
Credit from PAYG income
tax instalment variation5B $ OO
1,433GST on purchases
Your payment or refund amount
PAYMENT
9 $ $2,135
Solutions
72
Activity 1 Worksheet method
Account Details Amount
$
Sale
$
GST
Free
Export
GST
Free
$
Input
Taxed
$
Taxable
Supply
$
Capital
purchases
$
Non-Capital
Purchases
$
Input
Taxed
$
GST
Free
$
Taxable
Supply
$
PAYG
$
Gross
Wages
$
Excluded
$
Sales of goods 60,000 60,000 60,000
Sales of services 17,000 17,000 17,000
Residential rent received 11,000 11,000 11,000
Commercial rent received 9,900 9,900 9,900
Interest received 550 550 550
Commercial rent expenses 735 735 735
Export sales 26,000 26,000 26,000
Stationery 6,600 6,600 6,600
Bank fees 66 66 66
Accounting fees 4,400 4,400 4,400
Depreciation 3,000 3,000
Electricity 660 660 660
Business Ins. premiums 440 440 440
Interest paid 88 88 88
Motor vehicle costs 1,100 1,100 1,100
Purchase of trading goods 13,000 13,000 13,000
Rates - Council & W 770 770 770
Residential rent exp 550 550 550
Superannuation paid 2,250 2,250
NIA Subscriptions 121 121 121
Telephone 880 880 880
Wage ( gross ) 55,000 55,000
PAYG tax withheld 22,000 22,000
Promotional Expenses 1,320 1,320 1,320
Purchase of printer 2,860 2,860 2,860
Sale of Printer 1,100 1,100 1,100
$125,550 $26,000 $0 $11,550 $88,000 $2,860 $30,730 $550 $924 $32,116 $55,000 $22,000 $5,250
G1 G2 G3 G4 G6 G10 G11 G13 G14 G17 W1 W2
Chapter 5: BAS & IAS
73
GST calculation worksheet for BAS
(If you want to use the calculation sheet method to work out GST amounts)
GST amounts you owe the ATO from sales
G1 Total sales (including any GST) G1 $ 125,550 G1 on the BAS
G2 Export sales G2 $ 26,000 G2 on the BAS
G3 Other GST-free sales G3 $ 0 G3 on the BAS
G4 Input taxed sales G4 $ 11,550
G5 G2 + G3 + G4 G5 $ 37,550
G6 Total sales subject to GST (G1 minus G5) G6 $ 88,000
G7 Adjustments (if applicable) G7 $
G8 Total sales subject to GST after adjustments (G6 + G7) G8 $ 88,000
G9 GST on sales (G8 divided by eleven) G9 $ 8,000
1A in summary on the BAS
GST amounts the ATO owes you from purchases
G10 Capital purchases (including any GST) G10 $ 2,860 G10 on the BAS
G11 Non-capital purchases (including any GST) G11 $ 30,730 G11 on the BAS
G12 G10 + G11 G12 $ 33,590
G13 Purchases for making input taxed sales G13 $ 550
G14 Purchases without GST in the price G14 $ 924
G15 Estimated purchases for private use or not income tax deductible G15 $ 0
G16 G13 + G14 + G15 G16 $ 1,474
G17 Total purchases subject to GST (G12 minus G16) G17 $ 32,116
G18 Adjustments (if applicable) G18 $ 0
G19 Total purchases subject to GST after adjustments (G17 + G18) G19 $ 32,116
G20 GST on purchases (G19 divided by eleven) G20 $ 2,920
1B in summary on the BAS
Solutions
74
Business Activity Statement (Extract)
Option 1: Calculate GST and report quarterly
Total sales G1 $ 125,550 OO
Does the amount shown X Yes No
at G1 include GST?
(indicate with an X)
Export sales G2 $ 26,000 OO
Other GST-free sales G3 $ 0 OO
Capital purchases G10 $ 2,860 OO
Non-capital purchases G11 $ 30,730 OO
Go to summary over the page to report GST on sales at 1A and
GST on purchases at 1B and then complete the PAYG sections
PAYG tax withheld
Write the W5 amount at 4 in summary below
55,000
Amount withheld where no
ABN is quoted
W1 $
Amount withheld from
payments shown at W1$
Total salary, wages and
other payments
Other amounts withheld
(excluding any amount
shown at W2 or W4
W4
W3
$
$
W2 22,000
OO
OO
OO
OO
Total amounts withheld
(W2 + W4 + W3)W5 $ OO22,000
Chapter 5: BAS & IAS
75
PAYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
OR
Write the T11 amount at 5A in summary below
Reason code variation
T3New varied rate %
T4
$ %
T1 x T2 (or T3) T11 $ OO
T2
T1 $ OO116,550PAYG Instalment income
Summary
Amounts you owe the ATO
1A + 4 + 5A +7 8A $ OO30,000
$
$
4
OO
OO
OO
OO22,000
PAYG income tax
instalment
Deferred company/fund
instalment
5A
7
8,000
PAYG tax withheld
1A $GST on sales
or GST instalment
$
Solutions
76
Amounts the ATO owes you
Do not complete 1B if using GST instalment amount (option 3)
2,9201B + 5B 8B $ OO
1B $ OO
Credit from PAYG income
tax instalment variation5B $ OO
2,920GST on purchases
Payment or refund?
X Yes, then write the result of 8A minus 8B at 9. This amount is
Is 8A more than 8B? payable to the ATO.
(Indicate with an X)
- No, then write the result of 8B minus 8A at 9. This amount is
refundable to you (or offset against any other tax debt you have).
Your payment or refund amount
9 $ 27,080
Chapter 5: BAS & IAS
77
Activity 1 Accounts Method.
Note: The Preparation for the BAS is different, the resultant BAS is the same.
CASH RECEIPTS BOOK
Date Account Details Receipt/ Invoice Number
Total Receipts
$
Total Sales ( GST Incl )
$
GST Collected
$
Non-capital amount
(GST excl ) $
Capital Sales amount
( GST excl ) $
GST Free
Export $
GST Free Sales
$
Input Taxed Sales
$
Other Receipts
$
Bank $
January 1st Sales of goods 60,000 60,000 5,455 54,545 60,000
Sales of services 17,000 17,000 1,545 15,455 17,000
Residential rent received 11,000 11,000 11,000 11,000
Commercial rent received 9,900 9,900 900 9,000 9,900
Interest received 550 550 550 550
Export sales 26,000 26,000 26,000 26,000
31st March Sale of Printer 1,100 1,100 100 1,000 1,100
TOTALS $125,550 $120,000 $8,000 $79,000 $1,000 $26,000 $11,550 $125,550
ACTIVITY STATEMENT REFERENCE G1 1A G2 G3
Solutions
78
CASH RECEIPTS BOOK
Date
Receipt/
Invoice
Number
Total
Receipts
$
Total Sales
( GST Incl )
$
GST
Collected
$
Non-capital
amount
(GST excl )
$
Capital Sales
amount
( GST excl )
$
GST
Free
Export
$
GST
Free
Sales
$
Input
Taxed
Sales
$
Other
Receipts
$
Bank
$
January 1st Sales of goods 60,000 60,000 5,455 54,545 60,000
Sales of services 17,000 17,000 1,545 15,455 17,000
Residential rent received 11,000 11,000 11,000 11,000
Commercial rent received 9,900 9,900 900 9,000 9,900
Interest received 550 550 550 550
Export sales 26,000 26,000 26,000 26,000
31st March Sale of Printer 1,100 1100 100 1,000 1,100
$125,550 $125,550 $8,000 $79,000 $1,000 $26,000 550 $11,000 $125,550
G1 1A G2 G3ACTIVITY STATEMENT REFERENCE
TOTALS
Account Details
AYG Income tax instalment
Option 2: Calculate PAYG instalment using income x rate
PAYG Instalment income T1 $ 117,550 OO
T2 $ 2.50% %
OR
New varied rate T3 %
T1 x T2 (or T3) T11 $ 2,938 OO
Write the T11 amount at 5A in summary below
Reason code variation T4
Chapter 5: BAS & IAS
79
Account Details
January
Payment Type
Total Payments
$
Total Non-capital Purchases
( GST Incl ) $
Total Capital
Purchases ( GST Incl )
$
Claimable GST
$
Stationery $
Electricity $
Motor Vehicle
$
Trading Goods
$
Teleph $
Sundries $
Gross Wages
$
PAYG $
Comments
Stationery
6,600 6,600 600 6,000 Bank fees
66 66 66 GST Free
Commercial rent expenses 735 735 67 668
Accounting fees 4,400 4,400 400 4,000
Electricity 660 660 60 600
Business Insurance premiums 440 440 40 400
Interest paid 88 88 88 GST Free
Motor vehicle costs 1,100 1,100 100 1,000
Purchase of trading goods 13,000 13,000 1,182 11,818
Rates - Council and Water 770 770 770 GST Free
Residential rent expenses 550 550 550 Input Taxed
Superannuation paid 2,250 2,250 No GST
NIA Subscriptions 121 121 11 110
Telephone 880 880 80 800
Wage & salaries ( gross ) 55,000 55,000
PAYG tax withheld 22,000 22,000 No GST
Promotional Expenses 1,320 1,320 120 1,200 No GST
Purchase of new printer 2,860 2,860 260 2,600
TOTALS $112,840 $30,730 $2,860 $2,920 $6,000 $600 $1,000 $11,818 $800 $12,702 $55,000 $22,000
ACTIVITY STATEMENT REFERENCE G11 G10 1B W1 W2
Solutions
80
Summary
Amounts you owe the ATO Amounts the ATO owes you
GST on sales or GST instalment
1A $ 8,000 OO
GST on purchases 1B $ 2,920 OO
Do not complete 1B if using GST instalment amount (option
3)
PAYG tax withheld 4 $ 22,000 OO
PAYG income tax instalment
5A $ 2,938 OO
Credit from PAYG income
tax instalment variation
5B $ OO
Deferred company/fund instalment
7 $ OO
1A + 4 + 5A +7
8A $ 32,938 OO
1B + 5B
8B $ 2,920 OO
Payment or refund?
X Yes, then write the result of 8A minus 8B at 9. This amount is Your payment or refund amount
Is 8A more than 8B? payable to the ATO. 9 $ $30,078
(Indicate with an X)
No, then write the result of 8B minus 8A at 9. This amount is PAYMENT