Easier GST reporting for food retailers

Many small food retailers buy and sell products that are both taxable and GST-free. Depending on the point-of-sale equipment used, identifying and recording these sales can be difficult for business owners. 

The ATO has introduced a series of simplified accounting methods (SAMs) to make it easier to account for GST and work out the amount of GST that is liable at the end of each tax period. 

Business owners can choose from five SAMs. The SAM you choose will depend on your business’ turnover, the nature of your business and the nature of your point-of-sale equipment (except for the purchases snapshot method). 

These methods help you work out the information you need to correctly complete the GST section of your activity statement. However, they can only be applied to sales and purchases of trading stock. If you decide to use a SAM, you will still need to separately consider other sales and expenses when you complete your activity statement. 

There are two broad categories of SAMs that apply: 

Businesses with a SAM turnover threshold of $2 million or less 

Businesses in this category have three choices: 

  • Business norms: You apply the standard percentages to your sales and purchases. 
  • Stock purchases: You take a sample of purchases and use this sample. 
  • Snapshot: You take a snapshot of your sales and purchases and use this. 

Business with a GST turnover of $2 million or less 

Businesses in this category have two choices: 

  • Sales percentage: You work out what percentage of GST-free sales you made in a tax period and apply this to your purchases. 
  • Purchases snapshot: You take a snapshot of your purchases and use this to calculate your GST credits. 

After electing to use a SAM, you cannot change your method of GST accounting in the first 12 months.

Contact the experts at Bush & Campbell on 02 6938 4600 to help you implement these changes within your business.

Cristy Houghton

Embarketing, 48 Johnston Street, Wagga Wagga, NSW, 2650

Cristy's unique career has taken her from country NSW to the city lights of Clarendon Street South Melbourne and back again. With an early career in radio as a copywriter and creative strategist, she is now a Jill of all trades as a graphic designer, website builder, blog writer, video editor, social media manager, marketing strategist and more. 

In fact, give her any task and this chick will figure out how to do it! Go on, we dare you!

No, really, we DARE you!!

Cristy has won two Australian Commercial Radio Awards (ACRAs) for Best Ad and Best Sales Promotion, and even has an 'Employee of the Year' certificate with her name on it.

Cristy and her husband James have traveled extensively through Russia, China and South East Asia, and have two fur-babies, Sooty (cat) and Panda (puppy). Cristy loves drinking coffee, meeting people to drink coffee, coffee tasting and coffee flavoured cocktails. She also enjoys road trips, TED Talks and watching cat videos on youtube.