As the country slowly gains back its momentum from the holiday season taxpayers, especially GST-registered enterprises, should be aware that the Australian Tax Office has increased its focus on its compliance program as they expect higher tax debts, non-compliance and fraud stemming out from the current state of the sluggish economy.
On the Business Activity Statement (BAS) and GST front, we have already witnessed an increase in audit by the ATO on BAS. By way of an example, it is likely that a BAS will be picked up for an audit if the ATO finds a BAS with abnormally high GST refund among other factors. An audit could lead to another such as auditing an all the BAS lodgements of a financial year. What the auditors will be looking for primarily is substantiation to verify whatever you have declared and claimed is valid with supporting evidence.
So make sure that you have the substantiation in place before you lodge your BAS. Report the GST payable correctly and match with the sales/revenue figure and also keep all your tax invoices for GST paid. Under the tax law you can only claim GST if you have a valid tax invoice showing the date, issuer’s ABN, description and the GST amount and one of the most important thing – make sure it is paid (cash basis BAS). So make sure you keep an eye on all your business transactions just to err on the safe side as the ATO has the power to amend your BAS and impose penalties if there is lack of substantiation.
It is essentially a warning that you can’t run away from your mandatory tax obligations but you do have an avenue to contact the ATO to find an arrangement, such as paying tax on an instalment basis, if the business is genuinely going through difficult times.
If you need assistance with your BAS or GST, please contact Davenports and find out how we can help you.
davenports FINANCIAL SOLUTIONS
Phone:: (03) 9510 7600
Disclaimer: This post is just the view of the blogger only. It should not be relied upon as susbtitute for professional advice regading actual facts or circumstances. The blogger do not accept any liablity for any injury, loss or damage resulting from any person acting, or referring to act, in reliance on all or part of these materials.
