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2015 RECKON ELITE PRACTICAL CHAPTER 12

IN CLASS EXERCISE

Applying for an AUSTRALIAN BUSINESS NUMBER (ABN) (Page 490)

Richard Smales (TFN 999 999 582) (DOB 11/11/1983) commenced a new cabinetmaking
business as a sole trader at 269 Main Street, Croydon, Victoria, 3136 on February 1, 2014. He
has registered his business using the trading name Chips and Chops and estimates that his
turnover will be a little over $50,000 (excluding GST). It is his first time running a business and
he needs to apply for an ABN and register for GST. He intends to lodge his Business Activity
Statements quarterly and will use the cash accounting method.
Complete his ABN application form. Additional details are as follows:
Home address:
Postal address:
Phone number:
Email address:

111 Maroondah Highway, Croydon, Vic. 3136


PO Box 256, Croydon, Vic. 3136
0494 987 543
chipchopwood@bigpond.com

Bank account:

Name: Richard Smales


BSB 024 369
Account number 78469870

** Students please note: This facility to apply for an Australian Business Number, is no longer
available within ELITE.

Taxpayers who need to apply for an Australian Business Number, should contact the A.T.O. directly or
alternatively, apply on line at https://abr.gov.au/

Using the form on the student disk, prepare the ABN application for this client.
See PDF of completed form on Student Disk

IN CLASS EXERCISE 12.3 BUSINESS ACTIVITY STATEMENT (Page 524)

***Students should combine the client details previously provided in the In Class Exercise to
complete this exercise.
CREATE A NEW CLIENT IN THE DATABASE

ENTER AT THE BUSINESS/TAX


DETAILS TAB

TFN:
ABN:
SELECT:
GST REGISTERED

999 999 582


37 111 155 556
TAX RESIDENT
YES

BSB
ACCOUNT NUMBER
ACCOUNT NAME

024 369
78469870
RICHARD SMALES

IN CLASS EXERCISE
SOFTWARE COMPATIBLE
Richard Smales (see details from Part 1 in-class exercise in this chapter) asks you to complete
his Business Activity Statement (BAS) for the quarter ending June 2014. His Mobile number is
0498 682 255
He provides you with a copy of the BAS form he has received from the ATO that shows his
Australian Business Number (ABN) is 37 111 155 556 and the June 2013 quarterly statement
Document ID Number is 00 104 999 744. It also shows the due date for lodgement and
payment is 28 July 2014.
Richard advises that he uses the cash accounting method. The business Income and expenses
for the June 2014 quarter are as follows:
Sales:

$15,950

Expenses:

Rent
Rates
Insurance
Electricity
Materials
Advertising
Telephone
Wood turner

$3,905
$ 900 (GST Free)
$ 264
$ 539
$3,036
$ 495
$ 561
$3,188 (Capital Purchase)

On this quarterly BAS, Richard has elected to pay the ATO Instalment amount of $640.
Select: CREATE CLIENT JOB (Using the arrows, select using the drop screens the following functions):
Select:
Select:
Select:
Select:
Select:

Tax Year 2014


Job Type BAS form (GA)
Period Type Quarterly
Period April to June 2014
OK

RICHARD provides you with a copy of the BAS form he has received from the ATO.

Enter all the relevant information from the BAS document that RICHARD has received from the ATO
NOTE: The ABN for this exercise use 37 111 155 556 and Document Id Number 00 104 999 744

Use the dropdown arrow to select the REPORTING PERIODS OPTION and the ACTUAL PERIOD of this
BAS. In this exercise you are completing the BAS for the April to June quarter.
NOTE: This election must be the same as the option selected when he applied for his ABN

RICHARD advises that the business Income and Expenses for the June 2014 quarter are as
follows:

Sales:

$15,950

Expenses:

Rent
Rates
Insurance
Electricity
Materials
Advertising
Telephone
Wood turner

$3,905
$ 900 (GST Free)
$ 264
$ 539
$3,036
$ 495
$ 561
$3,188 (Capital Purchase)

CLICK on the GST calculation workheet to enter sales and purchases amounts:

For the June quarter, RICHARDs business records show that his income and expense details are as
follows:
Sales (including GST)
$15,950
Business Related Expenses:

CAPITAL COSTS (inc GST)


NON-CAPITAL expenses (inc GST)
NON-CAPITAL expenses (GST Free)

$ 3,188
$ 8,800
$ 900

From the information above, ENTER onto the GST calculation worksheet as follows:

NOTE: At G11
enter TOTAL
Non-Capital
Purchases
ie. $9,700

At G14, identify
the GST free
purchases that
have been
INCLUDED at
G11 ie. $900

The totals transfer to the Calculation Screen:

As RICHARD does not have


any staff or associates that
he is withholding tax for, the
PAYG TAX WITHHELD work
sheet is NOT applicable.

SELECT: NEXT to proceed to


next work sheet.

On the BAS form sent to


RICHARD
the
ATO
has
indicated that he can either pay
a quarterly PAYG Instalment
amount of $640 or he can pay
PAYG Instalments based on the
actual income for the quarter.
RICHARD has elected to pay
the
SET
INSTALMENT
AMOUNT as estimated by the
ATO.

AT T7, enter the ATO Instalment Amount - $640

Complete only
when Varying the
Instalment amount

As RICHARD is not providing FRINGE BENEFITS for employees, this work sheet is not relevant.

The WINE EQUALISATION TAX work sheet is not relevant in this exercise.

LUXURY CAR TAX work sheet is not relevant in this exercise.

The DEFERRED INSTALMENT & FUEL TAX CREDIT work sheet is not relevant in this exercise.

On the Summary Screen, the totals have transferred.


The LEFT SIDE of the SCREEN, are the totals that the client owes the ATO
The RIGHT SIDE of the screen, are the totals the ATO owes the client

ELITE will calculate


the PAYMENT or
REFUND amount

From NAVIGATOR, SELECT printing option. A PDF of the completed BAS is on the student disk.

ENTERING PAYG INSTALMENTS PAID


Continue to use RICHARD SMALES as the client in RECKON ELITE.
On the June quarter BAS, RICHARD elected to pay the ATO Instalment amount of $640.
(See T7 on the BAS).
Assuming this was the only quarter that had a PAYG Instalment Amount, when he prepares him 2014 Tax
Return, this payment should be entered into ELITE as follows:
From NAVIGATOR, SELECT: Tax Estimate Screen:

To Enter PAYG Instalments paid,


SELECT: CREDIT FOR PAYG already paid
by clicking on the GREEN line

ENTER the details of each PAYG Instalment


that have been paid that are relevant to the
tax year.
NOTE: PAYG Instalments are entered based on
the QUARTER, NOT on the actual date paid.

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The total PAYG Instalments paid are reflected in the Tax Estimate

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