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Simpler GST FAQ

by Intuit•5• Updated 2 years ago

What is simpler GST?

The Australian Taxation Office (ATO) has listened to the concerns of small businesses, tax professionals, industry associations and software providers, and is working towards reducing GST compliance costs for small businesses.

The ATO is reducing the amount of GST information required for the Business Activity Statement (BAS) to simplify GST bookkeeping and reporting requirements.

What stays on simpler GST?

From July 1st 2017 you’ll only need to report:

  • Total sales
  • GST on sales
  • GST on purchases

What is removed from BAS?

From July 1st 2017 you’ll no longer need to report:

  • Export sales
  • GST-free sales
  • Capital purchases
  • Non-capital purchases

Does this apply to my business?

If your business is registered for GST, and you have an annual GST turnover of less than $10 million, you’re eligible for simpler BAS.

Do I still need to keep records?
Yes. You need to keep records, such as invoices, as proof of any claims you make in your BAS lodgements.

How often do I need to report GST?
However frequently you report now (e.g. monthly, quarterly or yearly) is how you’ll continue to report after July 1st 2017.

What is simpler GST?
Simpler BAS will make it easier for businesses to do their bookkeeping to classify and code GST transactions. To help you gain the most benefit from simpler BAS, QuickBooks Online is introducing simplified GST classification.

This simplified method allows you to code your GST transactions as:

  • GST
  • GST Free
  • Out of Scope

You’re no longer required to code your GST transactions against the detailed list of GST codes that included:

  • Export Sales
  • Input Tax
  • GST on capital purchases
  • GST on non-capital purchases
  • GST Free capital purchases
  • GST Free non-capital purchases

This change will reduce the complexity to run your business day-to-day and still enable you to be compliant with BAS reporting requirements.

I’m only seeing GST, GST Free and Out of Scope tax codes when I try to create a sales or a purchase transaction. Does this mean I’m already on simpler GST?

Yes, this means you’re already on simpler GST. You don’t need to do anything. After we introduced simpler GST, any new customer creating a file in QuickBooks Online would be set to simpler GST by default.

You can switch to simpler GST through the QuickBooks Online GST centre settings page.

  1.  Go to GST.
  2. Select Edit GST on top right-hand corner.
  3. Select Edit settings.
  4. Select Simpler under GST codes option.

Once you switch, you’ll see only the simplified GST codes while creating transactions.

NOTE: QuickBooks Online is not a tax or BAS agent. If you’re relying on advice from a BAS or tax agent, it’s recommended that you consult with them before you switch.

What will happen to my default GST settings once I switch?

You or your tax/BAS agent may need to set up default GST codes on chart of accounts, products and services, bank rules and recurring transactions. We will map any default GST codes on chart of accounts, products and services, and bank rules to the simplified GST codes. However, you’ll need to map the GST codes on recurring transactions, if any, to the new codes.

What will happen to my existing transactions if I switch to simple GST?

There will be no impact on your existing transactions when you switch to simple GST. You can view the transactions and run reports as you normally would. You can also edit your existing transactions. While editing, if you need to change the tax codes, you will need to choose from the list of simplified GST codes and will not be able to select the old detailed GST codes.

What will happen to BAS reports once I switch to simpler GST?

There are three BAS related reports in QuickBooks Online:

  1. GST details report - There will be no change to GST details report. You will continue to see transactions grouped by tax codes. If you have existing transactions that use the detailed GST codes, the BAS detailed report will continue to report these transactions under the detailed GST codes.
  2. GST summary report - Once you switch to simpler GST, the GST summary report will only display fields relevant to simpler BAS - G1, 1A and 1B with a few additional details. You will not see the fields that are removed from BAS in this report as you’re no longer required to report those fields.

How do I switch to detailed GST if I don’t want to be in simpler GST?

If you wish to switch to Simpler GST please reach out to our Customer Success Team: https://help.quickbooks.intuit.com/en_AU/contact

NOTE: QuickBooks Online is not a tax or BAS agent. If you are relying on advice from a BAS or tax agent, it’s recommended that you consult with them before you switch.

IMPORTANT NOTE:  If you’ve set default GST codes on chart of accounts, products and services, bank rules and recurring transactions, please be aware that you'll lose these default settings when you switch and the action cannot be rolled back. You’ll need to visit each of those sections to reset the GST defaults. There will be no impact on existing transactions.

What will happen to BAS reports once I switch to detailed GST?

  1. GST details report - There will be no change to BAS detailed report. You will continue to see transactions grouped by tax codes in the GST Details report. If you have existing transactions that use the detailed GST codes, the BAS details report will continue to report the transactions under the detailed GST codes.
  2. GST summary report - If you switch from simple GST to detailed GST, the GST summary report will only display fields relevant to simpler BAS - G1, 1A and 1B with a few additional details. You will not see the fields that are removed from BAS in this report as you are no longer required to report those fields.

Where can I find more information about simpler BAS?
You can find more information about simpler BAS on ATO’s website.

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