MYOB TipsFive Common GST Bookkeeping Mistakes
Claiming GST without valid tax invoices Under Australian tax law, you can claim a GST credit for purchases that cost in excess of $82.50 (including GST) but you must be registered for the GST and have a valid tax invoice (or recipient created tax invoice (RCTI). If you use an incorrect or incomplete tax invoice to claim a GST credit, the GST credit may not be allowed. To claim GST credits for purchases that cost $82.50 or less (including GST), you must keep documents such as cash register dockets, receipts or invoices to support your claims. You must also keep your tax invoices and other GST records for five years. To find out more about tax invoices, contact the Australian Tax Office. Claiming GST without realising that your supplier is not registered for GST A business in is only required by law to be registered for the GST if their GST turnover is $75,000 or more ($150,000 or more for non-profit organisations) and/or if you provide taxi travel as part of your business, regardless of your GST turnover. Taxi travel means transporting passengers by taxi or limousine for fares. However, a business with less than less than $75,000 ($150,000 or more for non-profit organisations) can also opt to register for the GST. Your supplier must be registered for GST before you can claim a GST credit on a purchase. Ask the supplier whether they are registered for the GST or ring the Australian Tax Office for more details. Claiming GST credits for full amount of purchase when goods are used partially for private purposes You are allowed a partial GST credit for the GST you pay in the price of things you use partly for business purposes and partly for private purposes such as a motor vehicle. The amount of the GST credit you are entitled will depend on how much you use the purchase for business purposes. In addition, if you account on a cash basis and have not paid for the purchase in full, you can only claim a credit for the GST included in the amount you have paid. Short-changing yourself by not claiming valid GST tax deductions Business owners often pay for expenses out of pocket or with their own personal credit card then make the mistakes of failing to track these expenses. They may then fail to submit the expenses to the company for reimbursement or lose tax invoices. A qualified bookkeeper or accountant will be able to track all expenses, keep up to date with all current tax legislation and be able to advise you what GST you can claim so you can receive the maximum rebate from the government come tax time. Not keeping accurate GST records The stereotype of a small business owner keeping their invoices in a shoebox unfortunately still rings true for a lot of small business owners. By employing a bookkeeper, using commercially available software used for bookkeeping records and keeping GST records up to date, you will be able to monitor your GST and simply your Business Activity Statement (BAS). GST is claimed when you lodge your BAS and the exact period you claim it will depend on whether you account for GST on a cash or accruals basis and your annual turnover. and you can concentrate on running your businessBy monitoring your GST and keeping accurate records, you will be ready to lodge your GST claim on time and reduce any tax liabilities. There are many advantages to having a bookkeeping service and just one of these is to make your GST less taxing and make it easier for you to record all your GST transitions and claim for all legitimate GST deductions. By leaving it to the experts, you can ensure your GST is done correctly and on time.
MYOB Backup Every time you enter data into your MYOB file you should back up. If you think that is too often then the frequency should be based on how quickly you would be able to re-enter data if something happens to your data file. There are two ways you can back up your data file. 1. Copy your data file and save it to a CD, DVD, external hard drive or, if your file is not too big, a USB Flash drive or a Zip drive. These are my preferred methods as you don’t need to restore your data before being able to directly access individual files. 2. When you exit MYOB it gives you the option to backup - simply say "Yes" and backup to whatever medium you choose. The downside to doing a backup (as opposed to copying files) is that if you need to use information from your backup you will have to restore the file as MYOB backups are compressed into a ZIP file and have to be uncompressed before the files can be directly read. Backup as a ZIP file When you exit MYOB it gives you the option to backup. If it doesn’t, go the FILE menu in MYOB and select BACKUP. The Company File Backup dialog box will appear. Select which options you want; I recommend that you back up all data and check the file for errors. Click on Continue. Your file will then be "zipped". Another box will appear - this is where you choose your destination drive. Using the Save In field drop down arrow, select the destination drive for your backed up data. By default MYOB will use the system date to name the backup file. You can change this by placing your cursor in the File Name field, deleting the default name and typing in whatever you want to call the file. Click on Save. You should then copy the backup file to another media (CD, DVD, Flash etc.) If this is a CD or DVD you will then need to burn the file onto the CD or DVD.
