This has been digging at me for some years now.
I have a computer business and it is GST exempt. This means there isn't much I can claim through tax but what about a customer that purchases a product from me for their business use?
Can they claim that product when they do their tax?
As it is their responsibility to know what they can claim, my concern is with me being GST exempt.
Any help would be appreciated.
Hello there @Denlyn
We're not sure exactly what you mean here. You might need to give us some more detail.
Only certain services are GST free or exempt. Do you mean your business is not registered for GST?
If you are registered you can claim GST credits when providing GST-free services.
If you are not charging GST on sales the buyer cannot claim GST regardless of what the purchase is for.
The buyer can claim anything as a business deduction in their income tax as long as it meets the 3 golden rules:
We hope this helps a little but if not we can give you a more tailored response if you'd like to share more info.
Hello there @Denlyn
We're not sure exactly what you mean here. You might need to give us some more detail.
Only certain services are GST free or exempt. Do you mean your business is not registered for GST?
If you are registered you can claim GST credits when providing GST-free services.
If you are not charging GST on sales the buyer cannot claim GST regardless of what the purchase is for.
The buyer can claim anything as a business deduction in their income tax as long as it meets the 3 golden rules:
We hope this helps a little but if not we can give you a more tailored response if you'd like to share more info.
Thanks for the reply.
Here is an example so let's put everything aside for the moment.
I am a customer.
I go to a business that sells computer parts.
That business sells me a monitor and states they are not registered for GST.
I take the monitor back home and start using it.
I have a receipt, and it is that time of year to do my taxes.
Can I claim that monitor through my tax?
Another scenario.
I run a business.
I am told by my accountant that I am now "Not registered for GST" because I don't make enough money.
All the products I buy from my suppliers include GST on each product.
As my business has been invoiced GST, I have the right to charge my customers GST as long as it is not displayed on the invoice.
The GST must be included into the cost of the item.
Can a customer claim that monitor on their tax?
I hope I make a bit more sense this time and yes, I am "Not registered for GST".
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