FNSBKG404 Carry Out Business Activity And Instalment Activity Statement Tasks

Business activity and instalment activity

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Abstract

The key purpose of this research is to analyse the procedures and methods of business as well as instalment activities based on the tax system of Australia. In every business activity, bookkeeping is an important tool to monitor business activity, since there are many complex tasks in the business whether the business is small or large. Thorough knowledge of several factors is needed to prepare the statements of the business activity (BAS) as well as the instalment activity (IAS). The target of this research is to identify the research methods adopted to know professional and legislative requirements as well as the important requirements for the preparation of activity statements.

The taxpayers, not registered under GST, use IAS forms. When the taxpayers are registered under GST they use BAS. An organization needs to update the knowledge for the requirements, professional as well as legislative and also prepare the activity statements for a business as well as instalments. There are two sources of data, namely, primary and secondary. However, in the practice of continuous upgrading of knowledge relating to business activities and preparing activity statements, the secondary source of pieces of information is used. These sources include several government records, websites, newspapers, journals, personal sources and books.

Table of Contents

Abstract 2

Introduction. 4

Discussion. 4

Research methods to know professional and legislative requirements. 4

Key requirements for preparation of activity statements. 5

ATO requirements for the preparation and submission of BAS and IAS. 5

GST. 6

TPB requirements. 6

Conclusion. 7

References. 8

Introduction

In every business, bookkeeping is one of the most important as well as complex tasks whether the business is small or large. Thorough knowledge of several elements is needed to prepare the statements of the business activity (BAS) as well as the instalment activity (IAS). This report aims to identify the research methods adopted to know professional and legislative requirements as well as the important requirements for the preparation of activity statements.

Discussion

Research methods to know professional and legislative requirements

The taxpayers, not registered under GST, use IAS forms. When the taxpayers are registered under GST they use BAS. An organization needs to update the knowledge for the requirements, professional as well as legislative and also prepare the activity statements for a business as well as instalments. There are two sources of data, namely, primary and secondary. However, in the practice of continuous upgrading of knowledge relating to business activities and preparing activity statements, the secondary source of pieces of information is used.

 These sources may include government records, websites, newspapers, journals, personal sources and books. There are monthly or quarterly reports published by business organizations. These reports are very useful for upgrading knowledge regarding professional as well as legal requirements of business activity. If the activity statements of a business are not submitted in time, it may be subject to the imposition of penalty. So, it is very essential to submit the activity statements of the business as well as an instalment on time and upgrade the knowledge required to do the same.

Key requirements for preparation of activity statements

There are many elements that should be taken into account for preparing the activity statements of a business. Firstly, there are some services provided by the tax agents, namely, preparing several documents of their clients regarding their liabilities and obligations as well as entitlements, statements, notices, returns etc. These agents must have the registration number from the board of tax practitioners. Secondly, the fringe benefits tax (FBT), is different from income tax and it is the additional tax that must be paid for the fringe benefit. Thirdly, the superannuation guarantee (administration) act was introduced in Australia in the year 1992.

This act is introduced for those employers who do not create enough superannuation contributions for their employees. Fourthly, the superannuation guarantee charge is a penalty that is is imposed on those employers who fail to pay the superannuation guarantee to their eligible employees. Fifthly, the GST is a completely new system of taxes. This refers to the value-added charge on most of the commodities as well as services. Sixthly, there is the income tax act. Moreover, there are many other laws of taxation that include taxes on fuel, luxury vehicles as well as on wines.

ATO requirements for the preparation and submission of BAS and IAS

The task of ATO is diverse in nature and is established for the smooth functioning of the economy of Australia. The task of the body is mainly to manage systematically the superannuam charges as well as taxes for providing support as well as fund services to support the people of Australia. Those who contribute to the provident fund, pay the tuition fees of their children, pay the premium of life insurance, registration charges and stamp duties, repay the home loan, invest in mutual funds are entitled to avail of these supports.

 In Australia, all companies are required to pay a federal tax amounting to 30 per cent of their income which is taxable. However, small as well as medium businesses are required to pay 25 per cent of their income that is taxable. The working of ATO is governed by a protocol related to superannuam as well as taxes. ATO manages the tax as well as superannuam systems very systematically in Australia and provides support as well as a fund to the Australian people.

GST

Another important function of ATO is to collect GST. This is a new system of taxes imposed on commodities and services (Mitchell, Voon& Hepburn, 2019). This is a tax of 10 per cent of the commodities and services as well as other products consumed and sold in Australia. However, some commodities and services, namely, some specific food items, healthcare service and some items of housing are exempted from this taxation (Giesecke& Tran, 2018). GST was started in 2000 and was introduced by the government of John Howard. Every business of Australia with a turnover of a threshold level are required to pay GST (Tran &Zakariyya, 2021). After the introduction of GST in Australia, primarily there were many impacts namely, on the refund scheme of tourists, economic impacts as well as political impacts. However, in the long run, the imposition of GST is proved to be very effective for the economy of Australia.

TPB requirements

TPB refers to an independent body in Australia for tax practitioners. The main purpose of establishing TPB was to protect consumers as well as ensure people that the practitioner of tax in Australia has an appropriate standard of ethical as well as professional conduct of the practitioner of tax. This is a statutory body that works independently to regulate the services of the agents of tax. According to some research there are some recommendations for vulnerable tax payers (Jogarajan, Fischer-Doherty & Panetta, 2020).

These services include the statement of business activity service or BAS in Australia. The functions of TPB are separate from the functions of ATO. However, ATO helps TPB to deal with the issues related to compliance for ensuring the integrity of the system of taxation, as well as the high degree of protection of consumers, are kept. Though ATO is separate from TPB, it is the main stakeholder of TPB, because ATO provides BAS agents as well as registered tax with access to online services of ATO.

Conclusion

It is evident from the above discussion that bookkeeping is one of the most important as well as complex tasks whether the business is small or large. Thorough knowledge of several elements is needed to prepare the statements of the business activity (BAS) as well as the instalment activity (IAS). This report described several methods as well as the sources of pieces of information research to know professional and legislative requirements as well as the important requirements for the preparation of activity statements.

References

Giesecke, J. A., & Tran, N. H. (2018). The National and Regional Consequences of Australia’s Goods and Services Tax. Economic Record, 94(306), 255-275. DOI: https://doi.org/10.1111/1475-4932.12419

Jogarajan, S., Fischer-Doherty, K., & Panetta, J. (2020). 2019 National tax clinic project: Melbourne law school tax clinic. Journal of Australian Taxation, 22(2), 27-48. Retrieved from: https://search.informit.org/doi/abs/10.3316/agispt.20210720050193

Mitchell, A. D., Voon, T., & Hepburn, J. (2019). Taxing tech: Risks of an Australian digital services tax under international economic law. Melbourne Journal of International Law, 20(1), 88-124. Retrieved from: https://search.informit.org/doi/abs/10.3316/agispt.20190903016409

Tran, C., &Zakariyya, N. (2021). Tax progressivity in australia: Facts, measurements and estimates. Economic Record, 97(316), 45-77. DOI: https://doi.org/10.1111/1475-4932.12578