Common Mistakes in GST Reporting and How to Correct Them

GST reporting errors are commonplace among businesses, which means that you might be falling prey to some of them yourself. The Australian Tax Office (ATO) took some time to highlight the more frequently made errors to help prevent them being made in future. These are a sample of them as well as simple solutions to correct them.

Calculation Errors and Transposition in Your GST Reporting

You would think that calculation errors would be the easiest to avoid, but this is not always the case. Miscalculations are often found, as are issues with transposing numbers. Double check all your figures before a BAS is lodged and get a second pair of eyes to go over them one last time to be sure.

Not Having Tax Invoices to Claim GST Credits

GST credits can only be claimed with valid tax invoices on hand to substantiate the claims. Some of the specifics relating to invoices required:

  • Invoices are required to prove business purchases over $82.50 (inclusive of GST)
  • Suppliers have 28 days to provide tax invoices from the date of a request being made
  • The ATO recommends waiting until the invoice is received before claiming GST credits, even if that pushes it into a subsequent reporting period
  • Incomplete tax invoices are not legitimate for tax purposes
  • Incorrect tax invoices are not legitimate for tax purposes

Ensure that all valid information is contained on the tax invoice upon receipt and before submission.

Common Mistakes in GST Reporting and How to Correct Them / Quantum Accounts

Not Understanding When GST Is Applicable

It is important to check what is GST applicable prior to claiming. This is often overlooked, especially when it comes to food. Making this error could result in making claims that are not legitimate. Further information on GST and food can be found on the ATO website.

Accounting System Errors

Errors in accounting system coding can result in transactions being incorrectly classified. The ATO recommends checking your business systems against their GST governance and risk management checklist to avoid this common issue.

Not Making Appropriate Corrections

If mistakes are discovered after a BAS has been lodged, they must be corrected. Errors can be corrected on subsequent statements to avoid penalties and general interest charge (GIC).

If you are still in need of assistance, Quantum Accounts offers you full support with your GST reporting needs, taking the responsibility in our stride for you, so that you can concentrate on running your business.

Contact us today to get the process started.

Common Mistakes in GST Reporting and How to Correct Them / Quantum Accounts

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