on 30-07-2014 01:06 PM
Hi, i think my business will turnover more than 75 this financial year, when should i register for gst? and can you tell me if my understanding is correct
if i bought an item and it included $10.17 GST and i sold it for $139.95 paying $14 GST would that mean i pay the difference between the two figures? which would be $3.83
OR do i pay the whole 14 dollars now but come tax time i get alot back?
Just not sure how the whole thing works like when it is paid, how it is calculated etc. Any help would be great thankyou
on 30-07-2014 01:40 PM
My advice would be to see an accountant before you do anything else as you really have no idea how GST works.
If you are a registered business with an ABN you would be filling in a BAS every month/quarter. That is where you should be declaring and paying your GST, less the amount that you are claiming back. It is a 2 step process in the BAS but has the effect of you paying just the difference between the 2 amounts.
I would advise not registering for the GST any sooner than you need to as it involves a lot of monthly paperwork that is not necessary unless you have to. You have 21? days to register after you turn over $75,000.
BTW, the GST included in a sale of $139.95 is $12.72, not $14.00...another reason to see an accountant to make sure you understand your liabilities.
on 30-07-2014 11:58 PM
31-07-2014 12:12 AM - edited 31-07-2014 12:14 AM
@dontwastedollarss wrote:
I thought GST was 10%? how did you get that figure?
It is 10%, but the equation is price + 10% GST = sale price, not 10% of sale price = GST.
GST is added on to a base price to get a GST inclusive amount. eg if we didn't have GST inclusive prices on eBay and I sold something for $20, then GST was added to the sale afterwards, it would be 10% of $20; which is $2, so final price is $22. You can see that 10% of $22 is $2.20, though, but if you divide the final price by 11, you get 2, the GST component.
When $139.95 is the GST inclusive price, it's $139.95 divided by 11 = $12.72
on 31-07-2014 12:19 AM
You add 10% to your selling price to allow for the GST. To find out how much GST is included in the total sale price you need to divide the sale price by 11. In the example of $ 139.95 the original price would have been $127.23 add $12.72 ( 10% of sale price ) this gives $139.95 total GST incl. The GST system is complex untill you get your head around it and a pain in the butt after you have it worked out. As Lyndall has advised it is essential you speak to an accountant.
on 31-07-2014 12:21 AM
Touche DG !!!
on 31-07-2014 12:30 AM
@chameleon54 wrote:Touche DG !!!
I'm oddly attracted to maths in threads o_O . Even if I know nothing else about a thread's subject, I'll be all like
on 31-07-2014 12:34 AM
on 31-07-2014 12:51 AM
on 31-07-2014 12:54 AM