INSTALMENT ACTIVITY STATEMENTS (IAS) - … · INSTALMENT ACTIVITY STATEMENTS (IAS) What is an...

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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


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



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


57



G2 Export sales

G2 $ G2 on the BAS




G4 $

G5 G2 + G3 + G4

G5 $ 19,140


(G1 minus G5) G6 $ 70,000


G7 $



G9 GST on sales


!A in summary

on the BAS





G12 G10 + G11

G12 $ 64,660




in the price G14 $ 6,534



G16 G13 + G14 + G15

G16 $ 6,534


minus G16) G17 $ 58,126

G18 Adjustments

(if applicable) G18 $ 2,090


adjustments (G17 + G18) G19 $ 60,216



1B in summary

on the BAS


GST calculation worksheet for BAS


( If you want to use the calculation sheet method to work out GST amounts )

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at G1 include GST?


Export sales G2 $ OO






Business Activity Statement( Extract )

PAYG tax withheld


(W2 + W4 + W3)W5 $ OO6,900

6,900

OO

OO

OO

OO

W3

$

$

W2


29,384


ABN is quoted

W1 $




other payments



shown at W2 or W4

W4


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T1 = G1 - G9 89,140 – 6,363 = $82,777



OR

$ OO82,777PAYG Instalment income T1

$ 4.20% %

T1 x T2 (or T3) T11 $ 3,477 OO

T2



T3New varied rate %

T4

BAS Summary


1A + 4 + 5A +7 8A $ OO16,740

$

$

4

OO

OO

OO

OO6,900

3,477PAYG income tax

instalment


instalment

5A

7

6,363

PAYG tax withheld

1A $GST on sales

or GST instalment

$

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5,4741B + 5B 8B $ OO

1B $ OO




Payment or refund?




- 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 ).


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



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


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G2 Export sales



G3 $ G3 on the BAS


G4 $

G5 G2 + G3 + G4

G5 $ 15,500


(G1 minus G5) G6 $ 44,562


G7 $ 0



G9 GST on sales


!A in summary

on the BAS





G12 G10 + G11

G12 $ 26,230




in the price G14 $



G16 G13 + G14 + G15

G16 $ 0


minus G16) G17 $ 26,230

G18 Adjustments



adjustments (G17 + G18) G19 $ 26,230



1B in summary

on the BAS

Amount Due $1,667





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at G1 include GST?











OR



T3New varied rate %

T4

$ 3.80% %

T1 x T2 (or T3) T11 $ 2,128 OO

T2



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T1 = G1 - G9 60,062 – 4,051 = $56,011

PAYG tax withheld


12,800


ABN is quoted

W1 $




other payments



shown at W2 or W4

W4

W3

$

$

W2 2,300

OO

OO

OO

OO


(W2 + W4 + W3)W5 $ OO2,300

Summary


4,051

PAYG tax withheld

1A $GST on sales

or GST instalment

$

PAYG income tax

instalment


instalment

5A

7

$

$

4

OO

OO

OO

OO2,300

2128

1A + 4 + 5A +7 8A $ OO8,480

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2,3851B + 5B 8B $ OO

1B $ OO





9 $ $6,095

Payment or refund?




No, then write the result of 8B minus 8A at 9. This amount is



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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



G2 Export sales

G2 $ G2 on the BAS


G3 $ G3 on the BAS


G4 $

G5 G2 + G3 + G4

G5 $ 0


(G1 minus G5) G6 $ 19,800


G7 $ 0



G9 GST on sales


!A in summary

on the BAS





G12 G10 + G11

G12 $ 15,760




in the price G14 $



G16 G13 + G14 + G15

G16 $ 0


minus G16) G17 $ 15,760

G18 Adjustments



adjustments (G17 + G18) G19 $ 15,760



1B in summary

on the BAS

Amount Due $367






69




at G1 include GST?


Export sales G2 $ 0 OO







PAYG tax withheld


4,760


ABN is quoted

W1 $




other payments



shown at W2 or W4

W4

W3

$

$

W2 760

OO

OO

OO

OO


(W2 + W4 + W3)W5 $ OO760

Solutions

70



OR



T3New varied rate %

T4

$ 5.60% %

T1 x T2 (or T3) T11 $ 1,008 OO

T2


Summary


1A + 4 + 5A +7 8A $ OO3,568

$

$

4

OO

OO

OO

OO760

1008PAYG income tax

instalment


instalment

5A

7

1,800

PAYG tax withheld

1A $GST on sales

or GST instalment

$


71

T1 = G1 - G9

19,800 – 1,880 = $18,000



1,4331B + 5B 8B $ OO

1B $ OO





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


73

GST calculation worksheet for BAS



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


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)



Does the amount shown X Yes No

at G1 include GST?








PAYG tax withheld


55,000


ABN is quoted

W1 $




other payments



shown at W2 or W4

W4

W3

$

$

W2 22,000

OO

OO

OO

OO


(W2 + W4 + W3)W5 $ OO22,000


75



OR



T3New varied rate %

T4

$ %

T1 x T2 (or T3) T11 $ OO

T2


Summary


1A + 4 + 5A +7 8A $ OO30,000

$

$

4

OO

OO

OO

OO22,000

PAYG income tax

instalment


instalment

5A

7

8,000

PAYG tax withheld

1A $GST on sales

or GST instalment

$

Solutions

76



2,9201B + 5B 8B $ OO

1B $ OO




Payment or refund?




- No, then write the result of 8B minus 8A at 9. This amount is



9 $ 27,080


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


PAYG Instalment income T1 $ 117,550 OO

T2 $ 2.50% %

OR

New varied rate T3 %

T1 x T2 (or T3) T11 $ 2,938 OO


Reason code variation T4


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


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


No, then write the result of 8B minus 8A at 9. This amount is PAYMENT

INSTALMENT ACTIVITY STATEMENTS (IAS) - … · INSTALMENT ACTIVITY STATEMENTS (IAS) What is an...

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