GST and reporting to the Australian Taxation Office

1

My first post and I can’t get anything to in where it says “uncategorized”.

I have a question about splitting up what is reported for Activity Reports. We are required (under simplified method for GST) to report the total of Sales (or Income) that has GST, the amount of GST on there, then separately the GST from purchases. From previous accounting we would have a 10% code for income GST, FRE for GST free, and NCG for Non-Capital Acquisition with GST. For larger businesses there are many other GST codes also, like NCF for Non-capital acquisitions GST free, INP for input taxed and many more for the wine industry etc.

All I can find is one code in Manager with everything to do with GST lumped into one account. I am manually looking up the Gross Sales and working out the GST from those sales, and deducting the GST balance in the balance sheet from it, to get the GST on purchases.

This doesn’t seem like a friendly way to do it, nor would the average accounts clerk necessarily know how to do it.
Is there a better way?

2

Go to Settings → Tax Codes where you can set up new Tax Codes or activate built in codes that are inactive (greyed out)

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3

That is not necessary in manger as it automatically separates the GST into sales and purchases.

Two methods are used to achieve this

  • Purchase invoices are assumed to be purchases, sales invoices are assumed to be sales
  • Receipts are assumed to be sales, payments are assumed to be purchased when contact is “Other”
  • Receipts or purchases when contact is a “Customer” are assumed to be sales, Receipts or purchases when contact is a “Supplier” are assumed to be purchases.

Try it in a test business

4

@AJD
It certainly doesn’t split it into Sales and Purchases separately.

So I created a new code, and applied it to two transactions with 3 taxable purchases and 2 gst free transactions on it, but it didn’t report any differently. I am wondering if it has something to do the Reporting Category when creating a code. The only option is the 10%, the same as for income. Two lines under I have made the account be the new a/c for GST on purchases, then I went back to the transaction and amended the two items to be the new GST a/c for purchases.

Result in the business activity statement is still the same. Nothing shows in item 1B GST on purchases.
The total for G! Sales with GST is wrong ,
3 for gst free is correct.
1A GST on sales is wrong
Total owing to ATO at the end is correct.
And now I have 2 general Ledger accounts, one for GST payable on Sales and one for GST recoverable on Purchases, it is at least recording well in general ledger now

But considering I have to report the GST’able sales separately, and the GST from sales, separately, and the GST on purchases separately, then this activity report doesn’t help.

5

@Patch What you wrote solves why this happens.
All the income comes from Rent statements which is Rent received, Outgoings recovered, LESS Agents fees, Outgoings paid out.
So the whole lot appears as a “Customer” and it assumes it is all Sales related.

It is a shame it doesn’t work off the Sales as in general ledger , and Expenses as in general ledger rather than the Customer/Supplier aspect.

Thank you for that insight.

6

if you enter the transaction on one line it has to lump it all together as no other information is provided.

If you enter the receipt with contact : other and a separate line for rent and outgoings (negative amount) then you should find your GST report reflects the sales and purchases separation.