Eligibility for GST on cash basis
Scenario:
My business's turnover for the year ended 30 June 2017 is expected to be $3.13 million (in 2016, it was $1.05 million). We operate a business (not a charity or not-for-profit organization) for which we account for income tax on a cash basis.
Are we still eligible to account for GST on a cash basis?
Explanation:
You are entitled to account for GST on a cash basis if your GST turnover is below the cash-basis turnover threshold of $2 million. If your GST turnover exceeds this threshold, you will be required to account on a non-cash basis unless:
- Your projected GST turnover is below the threshold
- You account for income tax on a cash basis, or
- The Commissioner gives permission for you to account on a cash basis.
Because you account for income tax on a cash basis, which means that you can use this basis for GST even though your GST turnover exceeds the threshold.