| Am I eligible to account for GST on a non-cash (accruals) basis? |
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ExamplePhilip is a GST registered architect who accounts for GST on a non-cash basis monthly. He supplies design plans for a new restaurant to a developer for $7,700 (including $700 GST) on 30 September. Philip gives the developer a valid tax invoice on the day of the sale but payment is not due for 30 days. Philip’s tax period ends on 30 September. As Phillip does not account for GST on a cash basis and has already issued a tax invoice for the supply, the $700 GST payable is accounted in the tax period ending on 30 September, even though he has not received any payment from the developer. The developer also accounts for GST on a non-cash basis monthly. The developer also claims the GST credit in the tax period ending 30 September because the tax invoice is dated 30 September. However, if the tax invoice was not a valid tax invoice (that is, it did not contain the information required for a valid tax invoice), the developer would claim the GST credit in the tax period he receives a valid tax invoice. Newer news items:
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