Calculate your purchases and expenses
The table below explains how to calculate your purchases and expenses depending on the accounting basis you use.
| Step | Action | Find out more |
|---|---|---|
| 1 |
If you use the invoice basis Add up the amount of all the purchases and expenses that include GST in the taxable period. Write this figure in Box 11 on your GST return. NoteYou must hold the necessary tax invoices or GST records. If you use the payments or hybrid basis Add up all the payments you made for purchases and expenses that include GST during the taxable period for which you hold the necessary tax invoices and GST records. Write this figure in Box 11 on your GST return. |
|
| 2 |
Multiply Box 11 by 3 then divide by 23. Write this figure in Box 12 on your GST return. Note: If completing a GST return for a period ending on or before 30 September 2010 divide Box 7 by 9. Write this figure in Box 8 on your GST return. |
|
| 3 |
Enter the sum of any credit adjustments on purchases and expenses from Box 13 on your GST adjustments calculation sheet (IR372) in Box 13 on your GST return. |
Calculate adjustments on private assets used in business Calculate other credit adjustments on purchases and expenses |
| 4 |
Add Box 12 and Box 13. This figure will give you your total GST credit for purchases and expenses. Write it in Box 14 on your GST return. |
Late claim of GST
If you can't claim GST now (eg because you have no tax invoice), you can claim it in a future taxable period.
Note
You can only claim your GST late on expenditure incurred in the previous two years. Exceptions to this two-year rule include:
- inability to obtain tax invoice
- disputed payments for expenditure
- mistakenly treating a supply as non-taxable, or
- clear mistakes or simple oversights.
Late claims for expenses invoiced at GST rate of 12.5%
When claiming a GST input tax credit in a later period, the rate of GST to use is the one that applies to the original transaction.
Instead of entering the GST inclusive amount on the invoice as an expense in Box 11 of your GST return you should account for the GST component on the invoice as a credit adjustment under "other" in Box 13 on your GST adjustments calculation sheet (IR372).
Example: Scott buys a chainsaw for his landscaping business on 22 May 2010 for $1,500 GST- inclusive and makes full payment on the day. Scott reviews the GST transactions for the end of year accounts in March 2011 and notices that the chainsaw was not accounted for in an earlier GST return.
Scott would have to make a credit adjustment in the next GST return to claim the original input tax credit of $166.67. He can only claim the GST at 12.5% as this was the rate when the time of supply occurred.
Employee reimbursement for an invoice at 12.5%
If you reimburse an employee and claim a GST credit after 1 October for an invoice issued at 12.5% then this is also a late claim. The GST portion of this claim (at 12.5%) is included as an adjustment in the GST return that make the reimbursement, provided you hold a valid tax invoice.
Purchases and expenses not included in the GST rate change adjustment
If you find that a purchase or an expense was not included in your "qualifying supplies" for your GST rate change adjustment (ie because you did not hold a tax invoice when calculating the adjustment) then you can make a late claim in the period in which you make payment to the supplier for the expense.
Because the late claim will be for an amount originally invoiced at 12.5% record the GST component of the invoice as a credit adjustment rather than including the amount paid as an expense on your GST return.
Note
When making payment for a purchase that was included in your GST rate change adjustment you do not need to make any further adjustment when you record the payment as an expense in your GST return.
Find out more
Next steps
Date published: 29 Sep 2010
Back to top