1st January, 2015
The thought of a GST audit would frazzle most people. Unfortunately, it does happen and could happen to you. The Australian Tax Office (ATO) conducts GST audits to ensure businesses fulfil their legal obligations and operate appropriately within the system.
These audits may be conducted by phone and/ or visit from the ATO to check the integrity of information lodged.
Some of the key factors that may raise concerns are:
First, make sure you have up to date and accurate record keeping when it comes to GST. With the appropriate accounting software solution, you are already on your way to doing this.
You must comply with the ATO’s GST requirements. With each BAS lodgements, you should maintain all the necessary documentation and reporting to support your GST claims. Ensure your accounting software is compliant to the ATO and is set up to account for GST accurately.
After entering all receipts, tax invoices and entries from your bank and credit card statements into your accounting software, these are the reports and documents you should file
If you follow these valuable business practices and comply with the ATO GST regulations, you should have no reason to be nervous of audit reviews. Remember, you must keep your records for five years from the last assessment you lodged.
In my experience, the GST audits that our clients have undergone have been very simple. The ATO generally requires a list of all the transactions that make up the reported GST figures. Then, they will identify several transactions and ask for copies of the invoices to prove these transactions took place. This is when a good filing system is vital.
For businesses using MYOB Accountright, the specific reports that we use are:
With MYOB Accountright, it is very easy for your tax advisor or your BAS agent to log into your file and lodge the figures on your behalf, if you don’t lodge them yourself.
Make sure you meet all your tax and compliance obligations during the EOFY. Check out MYOB’s Tax Changes Information section, meant to help startups and small businesses (SMEs) stay on top of their game with tax changes and tips.
The information provided here is of a general nature for Australia and should not be your only source of information. Please consult an experienced tax agent as each small business’ circumstance will vary for end of financial year.