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9 July 2020
Our initial accountant set us up with accrual system for paying tax. He made so many mistakes in our books we had to get rid of him.
This year we have $40 000 of debtors outstanding. Due to COVID we don't know if we will ever be paid and which of that we will have to write off
Is there anyway to switch from paying tax on an accrual basis to a cash basis (so we only pay tax on money actually received)?
Most helpful response
10 July 2020
10 July 2020
If in choosing an accounting method for GST and you are eligible to change accounting methods, you can change from non-cash to cash but you will need to contact us
Generally if you call us and we are able to do the change because you are eligible, this will take effect from the beginning of the next reporting period from time of the phone call.
The means that in the first tax period you use the non-cash method you need to:
You are also eligible to claim any unclaimed GST credits that you hold a tax invoice for in the first tax period.
Hope this helps - eligibility is detailed under choosing an accounting method for GST.
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