1Goods and Services Tax: Simplified Accounting Method Determination (No. 38) 2016 for Restaurants, Cafes and Caterers – purchases snapshot method

Legislative Instrument

Goods and Services Tax: Simplified Accounting Method Determination (No.38) 2016 for Restaurants, Cafes and Caterers – purchases snapshot method

I, Deborah Jenkins, Acting Deputy Commissioner of Taxation, make this determination under subsection 123-5(1) of the A New Tax System (Goods and Services Tax) Act 1999 (GST Act).

Deborah Jenkins

Acting Deputy Commissioner of Taxation

Dated: 13/09/2016

Name of determination

This determination is the Goods and Services Tax: Simplified Accounting Method Determination (No. 38) 2016 for Restaurants, Cafes and Caterers – purchases snapshot method.

Commencement

2. This determination commences the day after registration.

Repeal of previous determination

3. A New Tax System (Goods and Services Tax) Act 1999 Simplified Accounting Method Determination (No. 1) 2006 (the previous determination) - F200L02632, registered on 9 August 2006, is repealed on commencement of this determination.

Determination (Which entities are covered by this determination?)

4. An entity may choose to use the simplified accounting method (SAM) in Clause 5 to work out its input tax credits for acquisitions of trading stock for a tax period if:

(a) it is registered for GST throughout the tax period; and

(b) during the tax period, it operated a restaurant, café or catering business; and

(c) its GST turnover does not exceed the small enterprise turnover threshold.

Note: This method can be used irrespective of whether the entity has adequate or inadequate point-of-sale equipment.

Method

5. The steps for this SAM are as follows:

(1) Choose a sample period

(a) For each financial year, select a continuous four-week sample period during 1 June to 31 July, and select another continuous four-week sample period during 1 December to 31 January. For each sample period, record the amounts and the GST status of the entity’s trading stock purchases.

Note: Two new calculations of the GST-free percentage must be done (about every six months) to calculate the amount of GST-free trading stock for the tax period(s) in each financial year.

(b) For an existing business that starts to use this SAM where the start date is not from 1 June to 31 July or from 1 December to 31 January, the first sample period can be either:

(i) a continuous four-week period in the tax period in which the entity starts to use the SAM, or