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Most goods that are importated to Australia are GST payable. The importer will need to pay the GST to the Department of Immigration and Border Protection (DIBP) before the goods are released. When the importes are on sold you need to report and the GST evenit is paid by the importer. It has to be noted on the BAS and GST is payable unless it is tafree or input taxed. Activity 19Consider these two issues:A business makes a taxable sale of $650 and includes the sale figure in its BAS. In the next period the buyer returns the goods as they are faulty. The owner of the business agrees to refund in full as there was nothing similar that could be supplied.A regular client has purchased goods on account for $9,500 and this is reported in the BAS. If clients pay on or before the due date the business provides a 3% discount. The account is paid within the account period and the client receives a discount of $285.1. Complete the worksheet showing the adjustments
3.Why might you need to make adjustments and what two types of adjustment are there? 50–60 wordsWe must make sure to make adjustments as we need to claclate the correct amount of the GST.There are two types of adjustments:1.Increasing adjustments – which means that it increases the amount of GST that you need to pay for the reported person based on G72.Decreasing adjustments – which lowers your GST amount to be paid by the reported time based on G184.Are adjustments used to correct errors in a previous BAS? 20 wordsNo. We use the adjustment to correct errors in the current BAS statement and you need to confirm your claim with the ATO.(1)Adjustment forsales(2)Amount forsales (before thechange occurred)included at G1(3)Newamountfor sales(4)Increasing adjustment(fillin this column if (3) is morethan (2) [subtract (2) from(3)](5)Decreasing adjustment(fillin this column if (2) is morethan (3) [subtract (3) from(2)]Cancellation of asale$650$0$650Reduction inamount of salebecause of discountor rebate$9,500$9,215$285Sale has stoppedbeing taxableIncrease in amountof saleSale has becometaxableTotal$935
5.For what purpose are adjustments used? 50 wordsIf we use the full report method to report GST, we can use the calculation sheet method or theaccounts methods we can then compete the activity statement for the reporting period. If we use a simple BAS reporting Methos, we can use the accounts method to complete the activity statement for the reporting period. Activity 201.If a business has an annual turnover over $20 million, what options does it have on how to pay its GST obligations? By what method can it report and pay its GST? 20–40 wordsAccording to the ATO, if the company’s GST turnover is $20 million or more, we must report and pay GST on a monthly basis as well as lodging the activity statement electronically.