GST Treatment Indicate the tax treatment for each of the transactions listed. The applicable tax treatments are
Question:
GST Treatment Indicate the tax treatment for each of the transactions listed. The applicable tax treatments are Taxable/GST-Free/ Input Taxed/ Out of Scope.
GST Treatment
The list of transactions are following:
- Bag of oranges sold
- Interest paid
- Storage rent (commercial) paid
- Superannuation paid
- Gas usage charges paid
- Fresh milk sold
- Sale of Residential premises (not new)
- Stamp duty paid
- New computers purchased
- Website development expenses paid
- New desks bought
- Accounting fees paid to tax accountant
- Water rates paid
Question 2 – DMG Smiles Dental Supplies
The information has been summarised for DMG Smiles Dental Supplies during the September 20X5 quarter in Appendix ‘Case Study - DMG Smiles Dental Supplies’.
- Prepare the GST Calculation Worksheet and all relevant sections of DMG Smiles' September 20X5 BAS showing the final amount refundable to or payable by DMG Smiles.
Prepare the GST Calculation Worksheet and all relevant sections of DMG Smiles' December 20X5 BAS showing the final amount refundable to or payable by DMG Smiles
Appendix: Case Study - DMG Smiles Dental Supplies
- GST calculation worksheet can be accessed from the following link: https://www.ato.gov.au/assets/0/104/694/815/bc3893a5-0d8c-4ed6-84f4-6af8fbcb9d12.pdf
- A sample BAS form can be accessed from the following link:https://www.ato.gov.au/uploadedFiles/Content/CAS/downloads/BUS25199Nat4189s.pdf
- There are multiple ways to write in a non-editable PDF document. One such way has been explained in the link below: http://smallbusiness.chron.com/write-something-pdf-file-save-55912.html.
- Accounting Standards: http://www.aasb.gov.au/Pronouncements/Current-standards.aspx
- Organizational policies and procedures: http://startupjunkies.com/extras/acct-policies.pdf
Financial Information for September 20X5 quarter.
Sales | ||
Total cash sales (Incl GST) | 70,000 | G8 |
Other GST-free sales | 19,140 | G3 |
Purchases (Incl GST) | ||
Furniture and Fittings (Incl GST) | 4,180 | G10 |
Other Capital Purchases (Incl GST) | 45,650 | G10 |
Non-Capital Purchases (Incl GST) | 5,260 | G11 |
GST-Free Non-Capital | 6,534 | G11 |
Cash Payments Book | ||
Wages (net) | 22,484 | |
Other Expenses (Incl GST) | 880 | G11 |
Stationery and supplies (Incl GST) | 2,156 | G11 |
General Journal (Incl GST) | ||
Bad debts | 2,090 | G18 |
Other Information: | ||
PAYG withheld from wages | 6,900 | W2 |
Commissioner's rate | 4.20% |
Information for December 20X5 quarter.
DMG Smiles Dental Supplies had a PAYG Instalment amount of $3,477 in the September 20X5 quarter based on sales of $82,776. It is now end of December and the sales for this quarter have been significantly low due to a major change in government legislation in dental supplies industry. DMG Smiles CEO Mr. Dominic Villa predicts that the current situation will continue throughout the current year and the company is due to incurring the biggest loss in its history. Hence Mr. Dominic has asked to vary the installment amount to zero for the December 20X5 quarter BAS. Other figures for the quarter have been calculated below.
G1 Total Sales | 5,780 |
G2 Other GST-free sales | 1,225 |
G8 Sales including GST | 4,555 |
G9 GST on Sales (G8 ÷ 11) | 414 |
G10 Capital purchases | 3,305 |
G11 Non-capital purchases | 19,700 |
G19 Total purchases subject to GST after adjustments | 23,005 |
G20 GST on purchases (G19 ÷ 11) | 2,091 |
W1 Total salary & wages | 14,680 |
4 PAYG tax withheld | 3,760 |
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill