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How do I report an insurance payout for public liability and is gst claimable

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we are a small business. husband is a contractor working on a roof, knocked bricks which fell through roof, ceiling and kitchen below. had business insurance policy which paid out to fix. we paid excess. no gst. Received a payment to pay the contractor paid to fix the roof etc but had to pay gst on this. how do I report the payment, and can I claim the gst we paid?

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ATO Community Support

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Hi @shirldanny ,

 

If your husband is registered for GST he can claim the GST he paid when he lodges his business activity statement.

You can claim GST credits if the following conditions apply:

  • you intend to use your purchase solely or partly for your organisation, and the purchase does not relate to making input-taxed supplies
  • the purchase price includes GST
  • you provide or are liable to provide payment (whether monetary for non-monetary) for the item you purchased
  • you have a tax invoice from your supplier (for purchases more than $82.50 including GST).

 

If your husband is registered for GST (and claims the GST credit on his BAS) he would also claim the GST exclusive amount he paid the contractor on the entity's tax return (eg individual tax return for sole trader, Company tax return for company structure). See Business tax deductions

 

If your husband is not registered for GST he cannot claim the GST credit through a BAS lodgement. He can, however, claim the total expense (including GST) on the entity's tax return.

 

I hope this helps,

JasonT

1 REPLY 1

Most helpful response

ATO Community Support

Replies 0

Hi @shirldanny ,

 

If your husband is registered for GST he can claim the GST he paid when he lodges his business activity statement.

You can claim GST credits if the following conditions apply:

  • you intend to use your purchase solely or partly for your organisation, and the purchase does not relate to making input-taxed supplies
  • the purchase price includes GST
  • you provide or are liable to provide payment (whether monetary for non-monetary) for the item you purchased
  • you have a tax invoice from your supplier (for purchases more than $82.50 including GST).

 

If your husband is registered for GST (and claims the GST credit on his BAS) he would also claim the GST exclusive amount he paid the contractor on the entity's tax return (eg individual tax return for sole trader, Company tax return for company structure). See Business tax deductions

 

If your husband is not registered for GST he cannot claim the GST credit through a BAS lodgement. He can, however, claim the total expense (including GST) on the entity's tax return.

 

I hope this helps,

JasonT