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Navigation: Financial > Configuring Financials > Setting Up GST > GST Rates in Category Setup Australian GST Rates |
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Incomes (Supplies)
There are six GST Rates available for income categories:
Phoenix calls these GST Rate 0 incomes. They do not appear on the GST calculation sheet at all. Any transfers between bank accounts, loan drawings, or any other transactions that should be excluded from the GST calculation sheet should use this rate. Examples of items for GST Rate 0 incomes would be •salary and wages and other employment income •pensions, annuities and so on •amounts received from a hobby •trust and partnership distributions •dividends •capital subscriptions, for example, amounts received by a company for shares issued •loans received •monies transferred between accounts |
This is for income transactions where 1/11th of the gross amount is payable to the ATO. This should be considered the normal case. Taxable supplies are included in G1. |
Where the income is for the supply of goods or services that are deemed to be GST Free (e.g. fresh food etc.) other than Exports, the transaction is entered as a GST Rate 2 transaction. GST free supplies are included in G1 and G3 on the GST calculation sheet. There is an extensive list of items that constitute GST free supplies. For more information on what supplies you make that would be GST free contact your financial adviser, or the Australian Taxation Office. The % claimable is ignored for GST Free goods, as it has no meaning for the GST Return. |
Where the income is for the supply of goods or services that are deemed to be Input Taxed (e.g. residential accommodation), the transaction is entered as a GST Rate 3 transaction. Input Taxed supplies are included in G1 and G4 on the GST calculation sheet. Some examples of Input taxed supplies include •financial supplies •supplies (by lease or hire) of residential premises •sales of residential premises other than commercial residential premises or new residential premises The % claimable is ignored for Input Taxed goods, as it has no meaning for the GST Return. For more information on what supplies you make that would be input taxed contact your financial adviser, or the Australian Taxation Office. |
Where the income is for the supply of goods or services that are exported according to the ATO's definition of exports, the transaction is entered as a GST Rate 7 transaction. GST free export supplies are included in G1 and G2 on the GST calculation sheet. Note that the Australian Taxation Office has a very specific definition of what constitutes a GST free export. Amounts entered under this rate should include only the free on board value (the value used for customs purposes) of exported goods that are GST free. For more information contact your financial adviser, or the Australian Taxation Office. |
Adjustments are required to be made to Business Activity Statements in certain circumstances where conditions have changed since a transaction was originally entered. The A rate allows these situations to be handled. See GST Adjustments - Australia for more information on adjustments. Although this GST Rate could be set as the default rate for any sub-category in your system, it is anticipated that this rate would be used more on a transaction by transaction basis during data entry. |
Expenses (Acquisitions)
There are eight rates available for expense categories.
Phoenix calls these GST Rate 0 expenses. They do not appear on the GST calculation sheet at all. Any transfers between bank accounts, loan repayments, or any other transactions that should be excluded from the GST calculation sheet should use this rate. Some examples of items for GST Rate 0 expenses would be •Salary, Wages and other payments to employees •Amounts transferred between accounts •The component of motor vehicle purchases that you are not entitled to claim a credit for, during the new motor vehicles phase in period •The component of motor vehicle purchases greater than the car depreciation limit as indexed each year •Expenses that are of an entirely personal nature |
This is for non capital expenditure transactions where GST is included in the price, and all or some of the amount related to a "creditable purpose" as defined in the GST legislation. GST Rate 1 acquisitions are included in G11 on the GST calculation sheet. GST Rate 1 transactions can have the % claimable parameter set. If the % claimable parameter is other that 100%, then the non claimable component of the transaction will also be included in G15 as "estimated private use". |
This is for non capital expenditure where there is no GST included in the price (e.g. bank charges and interest paid). GST Rate 2 acquisitions are included in G11 and G14 on the GST calculation sheet. Some examples would be as follows •GST free acquisitions other than capital acquisitions, like rates and stamp duty •Input taxed acquisitions like bank charges and interest •Non capital purchases from persons not registered for GST |
This is for non capital expenditure where it is an expense relating to making an Input Taxed Supply (e.g. residential accommodation). GST Rate 3 acquisitions are included in G11 and G13 on the GST calculation sheet. Some examples of GST Rate 3 expenses would be •Expenses on residential properties that you have available for rent, sale or lease •Expenses on residential quarters provided for employees |
This is for capital expenditure transactions where GST is included in the price, and all or some of the amount related to a "creditable purpose" as defined in the GST legislation. Rate 4 acquisitions are included in G10 on the GST calculation sheet. Rate 4 transactions can have the % claimable parameter set. If the % claimable parameter is other that 100%, then the non claimable component of the transaction will also be included in G15 as "estimated private use". |
This is for capital expenditure where there is no GST included in the price. Rate 5 acquisitions are included in G10 and G14 on the GST calculation sheet. Some examples would be the acquisition of a business as a going concern or purchase of a 2nd hand utility from a person not registered for GST. |
This is for capital expenditure where it is an expense relating to making an Input Taxed Supply (e.g. residential accommodation). Rate 6 acquisitions are included in G10 and G13 on the GST calculation sheet. Examples of rate 6 expenses would be the purchase of a 2nd hand residential property that you will make available for rent sale or lease. |
Adjustments are required to be made to Business Activity Statements in certain circumstances where conditions have changed since a transaction was originally entered. The A rate allows these situations to be handled. See GST Adjustments - Australia for more information on adjustments. Although this rate could be set as the default rate for any sub-category in your system, it is anticipated that this rate would be used more on a transaction by transaction basis during data entry. |
Costs of Sales
Often when the income is received for a supply, some costs are deducted from the payment. Both the gross supplies, (income) and gross acquisitions (expenses) must be shown on the GST calculation sheet. To do this it is required that the deductions shown on the tax invoice associated with the sale are allocated to an expense category, not refunded against the income category.
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