Did you know? 🧐
At BizCore 360, we often find & then fix a range of common, simple & avoidable mistakes by businesses. Businesses who decide to go it alone to save money & process their own accounts & BAS reporting.
One of those common mistakes we see, involve payments made to Suppliers, where an Australian Business Number (ABN) has not been stated, resulting in non-compliant accounts & reporting.
It doesn’t really matter, Right? Wrong… These small mistakes quickly add up and may cost you, your hard earned $$$ & may also flag your business for time consuming & expensive audits.
So here is what you need to know! 🤓
1. Paying a supplier when the total invoice is above $75 excl GST, who does not state their ABN, you MUST withhold the highest marginal rate of tax from their payment (Invoice).
(The no-ABN withholding rule does not apply, if the seller completes a Statement by a supplier, declaring the supply is not made in the course of carrying on a business or where the sale amount is $82.50 or less).
2. You must report & pay to the ATO, via your BAS, the PAYG withheld amount, as No ABN PAYG withheld.
3. You must supply the supplier a payment summary for the withheld amount, at the SAME time you pay the net invoice.
4. You must include these details in your Annual report to the ATO.
Note: If you agree to provide a supplier with goods or services instead of paying money, withholding will STILL apply, if no ABN is provided.
What happens if you don’t???
From the 01st July 2019: If you have not withheld the PAYG and you pay the full amount of the Invoice, this becomes a non-compliant payment.
All non-compliant expenses to the business, that you would normally be able to claim, becomes a non-deductible expense!
You have worked so hard, made plenty of sacrifices & put so much of your heart & soul into your business, only to find at the end of the financial year, you now have to pay more tax than you thought you had to.
Contracting a registered BAS agent to assist your business to process the accounts, monthly reconciliations & BAS, will assist in keeping your accounts compliant, enabling you to report correctly and claim the full business expenses available, thereby reducing your tax liability.
Think you can’t afford to? How can you afford NOT to?
Think of your BAS Agent as another form of business insurance. They are a means of protecting your business. Your BAS Agent in effect adds value to your business. Their services are a tax deductible expense to your business, whereas your time is not!
Let your Business thrive with BizCore 360 by your side….