When preparing your BAS, it can be tempting to simply claim the GST on every business purchase. But not every purchase is fully claimable — and getting it wrong can lead to corrections later.

Businesses that are registered for GST can generally claim GST credits (input tax credits) for the GST included in goods and services they purchase for their business.

However, there are some important rules to remember. If an item is used for both business and private purposes, you must only claim the business portion of the GST credit.

For example, if you purchase a car and use it for ride-sourcing work such as Uber, but also use it privately, you should calculate the percentage of business use and only claim GST credits on that portion.

The ATO is also reminding taxpayers to check a few key points before lodging their BAS. GST credits cannot be claimed for purchases:

• Where no valid tax invoice is held
• Where the purchase was cancelled or refunded
• Where no GST was included in the price (for example, many bank fees)

Another important reminder: even if you have nothing to report for the period, you must still lodge a ‘nil’ BAS by the due date.

Some businesses also benefit from using annual private apportionment, which allows the private portion of certain expenses to be adjusted once a year rather than every BAS period.

Getting GST claims right from the start helps avoid adjustments, ATO queries and unnecessary stress. If you’re unsure whether your GST credits have been claimed correctly — or whether a different apportionment method might suit your business — it’s worth reviewing your BAS before lodging.

 If you would like a little help, please get in touch with us for assistance.

Need Help with your Business, Bookkeeping, Tax or SMSF requirements?

If you would like a little help, please get in touch with us for assistance. We can help with your business, bookkeeping, tax and SMSF requirements. To book an appointment, use our online booking system, give us a call on 07 3289 1700, or email us at reception@rgaaccounting.com.au.We look forward to assisting you this tax season!

Please also note that many of the comments in this publication are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances. Should you have any further questions, please get in touch with us for assistance with your SMSF, business, bookkeeping and tax requirements. All rights reserved. Brought to you by RGA Business and Tax Accountants. Liability Limited by a scheme approved under Professional Standards Legislation.