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Withholding obligation on the property sale transaction

This post is archived and may not be up-to-date.

Enthusiast

Views 1214

Replies 4

Hi

When I was reading the example 3 from the below link, I wasn't sure how it works for the supplier (i.e., ABC Company Pty Ltd). 

https://www.ato.gov.au/business/gst/in-detail/your-industry/property/gst-at-settlement---a-guide-for...

 

James (Purchaser)

ABC Company Pty Ltd (Supplier)

New residential property Sale

Proceeds : $550,000

GST Property Witholding amount : $550,000/11 = $50,000

 

I am just wondering how this transaction should be recorded in the books of ABC and reported on their BAS return.

Bank Dr $500,000 (Actual cash received would be $500k only as James withheld GST of $50k and paid to ATO)

Sales Cr $550,000?

GST Property Credit (Current Asset) Dr $50,000? (Separate account to establish?)

 

In BAS return, for this transaction only :

G1 :$550,000

1A : 0?

 

It is a bit confusing for me. If someone can share your thought, it would be greatly appreciated. 

 

Thanks. 

 

PinkyT

 

 

1 ACCEPTED SOLUTION

Accepted Solutions

Most helpful response

Community Moderator

Replies 0

Hi @PinkyT,

 

Thanks for your patience.

 

Check out Completing your BAS.

 

In your example;

 

The $550,000 is included in Label G1 Total sales
The GST payable of $50,000 is reported in Label 1A

 

Thanks

 

KylieS

 

4 REPLIES 4

Devotee

Replies 2

Record it on the BAS as per normal (incl $50k in 1A). The ATO will magically know that the $50k was withheld from your sale proceeds and offset it

 

 

Enthusiast

Replies 1

@MCA_Accountants 

 

Thanks. How about recording that transaction in the client's data file? 

 

Most helpful response

Community Moderator

Replies 0

Hi @PinkyT,

 

Thanks for your patience.

 

Check out Completing your BAS.

 

In your example;

 

The $550,000 is included in Label G1 Total sales
The GST payable of $50,000 is reported in Label 1A

 

Thanks

 

KylieS

 

Former Community Support

Replies 0

Hi @PinkyT,

 

Thanks for getting in touch!

 

We're checking some information regarding your query with a specialist area and we'll get back to you soon.

 

Thanks, JodieH.