Is your business paying GST on imported goods?

Is your business paying GST for imported goods?

GST applies to most imports over $1,000. GST is 10% of the value of the goods you’ve imported. You generally need to pay this to the Department of Home Affairs before you can receive the goods.

The deferred GST scheme will allow you to pay your GST later and there are eligibility requirements. If you are registered for this scheme, you don’t need to pay GST until after the goods are imported and you lodge your next business activity statement.

There are also methods for claiming a credit for any GST paid on goods you import for your business which we can help you better understand.

GST now also applies to imported goods valued at less than $1000, as well as digital products or services.

If you’re registered for GST and you import low value goods for your business, you shouldn’t have to pay GST on these purchases. You need to remember to provide your supplier with your ABN and a statement that you’re registered for GST.

If you’re charged GST incorrectly, or if the GST is less than $82.50, talk to us about claiming a GST credit on your next BAS without needing a tax invoice.

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$20k Business Tax Instant Asset Write-Off Extended

The ATO has just announced that the $20,000 threshold has been extended to 30 June 2019.

If you buy an asset and it costs less than $20,000, you can write off the business portion in your tax return for the relevant income year.

You are eligible to use simplified depreciation rules and claim an immediate deduction for the business portion of each asset (new or second hand) costing less than $20,000 if:

  • you had a turnover less than $10 million (increased from $2 million on 1 July 2016), and
  • the asset was first used or installed ready for use in the income year you are claiming it in.

Assets that cost $20,000 or more can’t be immediately deducted. They will continue to be deducted over time using the general small business pool. You write off the balance of this pool if the balance (before applying any other depreciation deduction) is less than $20,000 at the end of an income year.

The $20,000 threshold applies from 12 May 2015 to 30 June 2019 and reduces to $1,000 on 1 July 2019.

Remember, Access Tax and Accounting in Bankstown can help you with your business tax! so call us today!