Accounting for Taxation Flashcards
What elements are required on a tax invoice for GST purposes? (10)
Every Tax Invoice:
- the words “tax invoice”
- supplier name and address
- supplier GST number
- date of issue
- supplies description
Under $1000:
- total amount payable
- “Includes GST”
Over $1000:
- recipient name and address
- supplies quantity
- the GST-exclusive amount, the GST amount and the GST-inclusive amount OR the GST-inclusive amount and a statement that GST is included if GST is charged at the standard rate for all the goods or services listed.
What is the calculation for adding GST?
price + (price * 0.15)
What is the calculation for subtracting GST?
(price * 3) / 23
When is the GST payment due for a taxable period?
28th of the following month. If the due date falls on a weekend or public holiday, the due date is the following workday.
Two exceptions:
- Period ending 30th November = 15th January
- Period ending 31st March = 7th May
What are the available “taxable periods” (Filing frequency)? and what are the criteria.
Monthly - anyone can apply for a monthly taxable period. Businesses that turnover greater than $24 million must use the monthly taxable period.
Bi-monthly (default)- anyone earning less than $24 million can apply for a two-monthly taxable period.
Six-monthly - businesses that made or will make less than $500k can apply for a six-monthly taxable period.
What are the available “accounting basis’s” and what are the criteria?
Payment - businesses that made or will make less than $2 million can use the payment accounting basis.
Invoice (default) - anyone can use the invoice accounting basis.
Hybrid (uncommon) - any business can use the hybrid accounting basis.
What are the three accounting basis’s?
- payment
- invoice
- hybrid (income - invoice, expenses - payment)
What are examples of “exempt supplies”? (4)
- financial services
- donated products and services which are sold by not for profits
- rent on private home
- penalty interest
What are some examples of “zero rated supplies”? (3)
- exported goods
- sales of going concerns
- sales of land
What is a taxable activity?
A taxable activity is any activity carried out continuously or regularly by a business, trade, manufacturer, professional person or club. It includes any activity that supplies or intends to supply goods or services to someone else for a consideration but not necessarily for profit.
What do you need/need to do for GST registration? (7)
- Business IRD number (personal IRD number can be used for sole trader)
- BIC (Business Industry Certification) number
- Choose an accounting basis
- Choose a taxable period
- Bank account number
- Turnover for the last 12 months
- Expected turnover for the next 12 months
What is an exempt supply?
Goods and services which are not subject to GST and are NOT included in a GST return.
What are the six types of exempt supply?
- donated goods and services by non-profit bodies
- penalty interest
- financial services
- renting a residential dwelling
- residential accommodation under a head lease
- supply of fine minerals
What are zero rated supplies?
Goods and services that are taxed at a rate of 0% rather than 15% and ARE included in a GST return.
What are the four types of FBT?
- Motor Vehicles
- Goods and Services
- Low Interest Loans
- Employer Contributions
What are the three FBT rate options available?
- Single Rate: 63.93%
- Short Form Alternate Rate: ??%
- Full Alternate Rate: ??%
What are Fringe Benefits?
Non-cash benefits enjoyed or received by employees as a result of employment.
What is the filing frequency for FBT?
Quarterly
When do you have to register for FBT?
When you supply a fringe benefit as an employer.
What is an attributed fringe benefit?
A benefit only one employee uses.
How many accounts do I need to record Fringe Benefits.
A separate account will be needed for attributed and non-attributed benefits.
What is the current single rate applied to fringe benefits?
63.93%
What five elements make up the CAANZ Code of Ethics?
- Confidentiality
- Professional competence and due care
- Professional behaviour
- Objectivity
- Integrity
What are the four concepts of Confidentiality in the CAANZ Code of Ethics?
- Maintain confidentiality within the employing organisation.
- Maintain confidentiality of information disclosed by a prospective client.
- Do not disclose confidential information acquired as a result of professional activities and/or relationships, even when those activities and/or relationships have ended.
- Do not use confidential information for personal advantage or for the advantage of a third party.
