Change GST from Cash to Accrual |
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In this example, the date 30 June has been used, however it can be any date.
Transactions dated up to 30 June that were processed using the cash method will need to be treated as accrual now, and reported to the Australian Taxation Office for the first GST Period of the new financial year.
Assuming regular GST sessions (cash method) have been run to flag reported transactions, it is recommended the following steps be followed to ensure that no transactions remain in limbo.
1.In the live database, do a real cash GST session for the date prior to 30 June. Print the report, mark it A, and use these figures to lodge the June BAS. 2.Back up the database to create a copy to work on, then restore this as a new database named GST Changeover, or similar. 3.On the copy database (ie. the training database), any unpaid or part paid documents need to be dealt with prior to 1 July. Pay all debtors and creditors where invoice or purchase order date is prior to 1 July. Now, do another cash GST session for the date prior to 30 June. Print the report and mark it B – these figures will be included in the first BAS in the new financial year. 4.Back in the live database, change Tools > Options > Accounting > GST Calc Method to Accrual. 5.Run an Accrual GST session for the date prior to 30 June, then click Select All, Select All Types and Reconcile to clear all old transactions.
Jim2 will calculate all transactions on an accrual basis for GST from 1 July.
The combined results of reports B and the next GST session will equal what needs to be reported on the next BAS. The general ledger balance for GST Collected and GST Paid should be very close to this total, give or take rounding from previous payments entered.
In summary: 1.When changing the setting in Options, all accrual-based transactions from prior periods will appear in GST sessions, as they have never been included in a previous accrual GST Session. Run a dummy GST session up to the changeover date to clear them out of the real GST session. 2.In the first accrual-based GST session the GST will be significantly higher because of all the GST on unpaid invoices in Debtors and Creditors as at the changeover date.
Further information Complete a GST Session: Accrual Method Complete a GST Session: Cash Method Handle NZ GST in Australian Database Record Deferred GST on Imports |