WHAT IS GST

GST: is an indirect, broad based consumption tax
.
Indirect: Means that it is levied on the supply of goods or services, or activities rather than directly
on income.

Consumption Tax: Means that instead of being applied to income GST is applied to consumption, another
way of looking at it is that the tax is ultimately borne by consumers, not producers or
suppliers

Broad Based: Means that it applies generally to all transactions made by all types of taxpayers, with
only limited exceptions.

Commencement: Effective 1st July, 2000

Who is to Register Any person carry on a business and earn more than $49,999 must register for GST

Basis of Accounting: The GST and Input Credits that belong to each period are worked out according to
attribution rules, which vary according to whether you are on a cash basis or an accruals
basis of accounting.

If you are on the cash basis, you work out your GST and input tax credits for each tax
period on the basis of amounts actually received and paid out.

You can use the cash basis if:-
* Your annual turnover does not exceed $1,000,000
* You account on a cash basis for income tax purposes
* You are a charity; or
* You can convince the Tax office that it is appropriate.

If you use the accruals basis, you work out your GST and input tax credits for each tax
period on the basis of your entitlement to be paid and your obligation to pay. This will
often be when you give or receive an invoice