FNSTPB401
Complete Business Activity and Instalment Activity Statements
Student Assessment Workbook Part B
Part
B: C
ase
Stud
y
Knowledge Questions: BAS and IAS
ASSESSMENT WORKBOOK COVER SHEETTo the candidate: Print this coversheet and complete it by filling in all the required information and affixing your signature in the space provided. Your signature must be handwritten. Scan the completed cover sheet and submit it along with your evidence submissions. Use the filename: FNSTPB401 Part B Cover Sheet Part B
WORKBOOK: FNSTPB401
TITLE:Complete Business Activity and
Instalment Activity Statements Part B
WORKBOOK:Part B: Knowledge Questions – BAS and
IAS
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I have been advised of the assessment requirements, have been made aware of my rights and responsibilities as an assessment candidate, and choose to be assessed at this time.
I am aware that there is a limit to the number of submissions that I can make for each assessment, and I am submitting all documents required to complete this Assessment Workbook.
I have organised and named the files I am submitting according to the instructions provided, and I am aware that my assessor will not assess work that cannot be clearly identified and may request the work be resubmitted according to the correct process.
This work is my own and contains no material written by another person except where due reference is made. I am aware that a false declaration may lead to the withdrawal of
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Part
B: C
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KNOWLEDGE ASSESSMENT: BAS AND IAS
Question 1
From the statements below, select the two (2) responses that correctly describe the requirements for GST groups in relation to the preparation of activity statements under the New Tax System (Goods and Services) Tax Act.
☐i. A GST group is two or more associated business
entities that operate as a single business for GST purposes.
☐ ii. Any member of the GST may complete the GST component of an activity statement.
☐ iii. When preparing an activity statement, only one entity, known as the representative member, must manage the group's GST affairs and complete activity statements and accounts on behalf of the group.
☐ iv. Transactions between group members must be ignored for GST purposes.
☐ v. A requirement for GST is that members of a GST group are considered separate entities.
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Question 2
Describe the following GST terminology found in the A New Tax System (Goods and Services Tax) Act.
GST Terminology Code Description
i. Taxable supplies
GST
ii. GST-free supplies
FRE
iii. Input taxed supplies
ITS .
iv. Out of scope supplies
N-T
v. Export EXP
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What GST codes should be applied to the following items? Identify the appropriate GST classification by typing the correct code in the space provided.
GST – Taxable supplies
FRE – GST-free supplies
ITS – Input taxed supplies
EXP – Exported supplies
CAP – Purchase of capital assets
N-T – Out of scope supplies
Use capital letters in your answers.
GST Classification
Subject to 10% GST
tax
Rent received from tenants in rental property
Sale of a farm which carries on the same business
Purchase of a brand-new vehicle
Paid superannuation owing to Spectrum
Steel capped boots purchased by an employee to meet Health and Safety requirements
Paid doctor’s bill – injuries to an employee on the job
Sale of flowers to local florist
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Goods manufactured in Australia and sold in Japan
Money withdrawn to reimburse petty cash
Acquisition of a building to set up a factory
Stamp Duty
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Question 4
Discuss two (2) key requirements relating to activity statements which must be applied specific to taxable payments annual reporting. Each discussion must be 40-80 words.
i.
ii.
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Question 5
The following are reporting options under the New Tax System (Goods and Services) Tax Act:
Option 1 (calculate, report and pay GST monthly),
Option 2 (calculate, report and pay GST quarterly), or
Option 3 (calculate, report and pay GST annually).
Below are statements that describe these reporting options. Match each statement with the option it describes. Write down the option number only in the space provided.
Option Number Description
i. This option is for business with a GST turnover of $20 million or more.
ii. You can only use this method if you are voluntarily
registered for GST. That is, you are registered for GST and your turnover is under $75,000 (or $150,000 for not-for-profit bodies).
iii. This option is available to all businesses with a turnover of less than $20 million who have not been told to report GST monthly.
iv. This option is available to all businesses with a GST turnover of less than $10 million. The full reporting and instalment methods are not available.
v. If your GST turnover is $10 million or more, you need to use the full reporting method - calculate, report and pay your GST amounts quarterly.
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Question 6
Answer the following questions about activity statements.
a. What does BAS stand for?
b. What tax obligations are reported on the BAS?
c. What kind of business is required to lodge the BAS?
d. What does IAS stand for?
e. What are the only tax obligations reported on the IAS?
f. What tax obligation is not reported on the IAS?
g. Give the two (2) lodgement schedules for the IAS.
h. What kind of business is required to lodge the IAS?
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Question 7
Answer the following questions about BAS labels.
a. At which label on the BAS is the pre-determined quarterly fringe benefits tax instalment shown?
b. At which label on the BAS is PAYG withholding reported if one is a large withholder?
c. Are superannuation contributions included in this label?
☐ Yes ☐ No
d. How much is the amount that must be withheld in a previous financial year, excluding the last two months, to be considered a large withholder?
$
e. For those paying GST, at what label on the GST section of the BAS is the total sales reported if GST is calculated and reported quarterly?
f. For those calculating and reporting GST quarterly and completing the GST section on the BAS, the amounts that are reported at the label G3 should have also been reported at G1.
☐ True ☐ False
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g. Purchase or acquisition of which of the following falls under the G10 label on the BAS for those calculating and reporting GST quarterly? Select all that apply.
☐ Toyota Hilux ☐ Scholarship ☐ Farmland
☐ Imported wine ☐ Laptop ☐ Health insurance
☐ Salary ☐ Photocopier ☐ A defunct factory
h. For those paying GST instalment quarterly and paying annually, on what label on the BAS is the pre-determined instalment amount shown?
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Question 8
According to ATO, after activity statements have been prepared, obtained or the transactions completed (whichever is later), a sole trader is required to keep a copy of their general records. For how long must these records be kept? Select the correct answer.
☐ i. All records must be kept for 3 months.
☐ ii. Activity statements must be kept for 3 months, but payroll records must be kept for 12 months.
☐ iii. All records must be kept for 5 years.
☐ iv. Activity statements and payroll records must be kept for 5 years.
☐ v. All records must be kept for 7 years.
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Question 9
Complete the following table by setting out the lodgment schedule and payment requirements for the final financial quarter (April to June), according to ATO requirements.
Type of Payment Month Reported on which
document?
Lodgement and Payment
Date
PAYG Withholding
April
May
June
GST Collected and Paid
April
May
June
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PAYG Instalment
April
May
June
Fuel Tax Credit Claimable
April
May
June
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Question 10
In accordance with the Fringe Benefits Tax Assessment Act, select the three (3) statements that are true about reporting fringe benefits tax when preparing activity statements.
☐ i. All non-monetary benefits employees receive are reportable fringe benefits.
☐ ii. Fringe benefits tax (FBT) must be paid by employers for certain benefits provided to their employees.
☐ iii. If a car ‘held’ by the company is used by an employee for private use, the costs incurred for the use of the car is subject to FBT and must be reported in the activity statement.
☐ iv. Photographs are acceptable documentation to substantiate fringe benefits for travel diaries.
☐ v. The lodgement of the annual FBT return must be submitted to the ATO by the 21st May.
☐ vi. The fringe benefits tax year is from 1 July to 30 June.
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Question 11
1. List four (4) benefits which are exempt from FBT under the Fringe Benefits Tax Assessment Act.
i.
ii.
iii.
iv.
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Question 12
In 100-150 words, explain the measures enforced by the government to recover unpaid taxes under Part VII of the Fringe Benefits Tax Assessment Act.
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Question 13
Under the Taxation Administration Act, there are specific requirements which must be met when completing business activity and instalment activity statements.
Answer the following five (5) questions regarding information on reportable items.
a. Give five (5) examples of withholding payments an organisation is required to pay.
i.
ii.
iii.
iv.
v.
b. According to the act, an entity need not withhold an amount if the whole of the payment is exempt income of the entity receiving the payment. Give five (5) sections to which this exception applies.
i.
ii.
iii.
iv.
c. According to the act, an entity need not withhold an amount if the whole of the payment is not assessable income and is not exempt income of the entity receiving the payment. Which two (2) sections does this exception apply to?
v.
vi.
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FNSTPB401 Student Workbook – Part B Knowledge Questions – BAS & IAS Version No. 1Australian College of Business and Accounting Page 22
d. For sections 12-35, 12-40, 12-45, 12-47, 12-115, 12-120, 12-315 or 12-317, what three (3) benefits can be disregarded in the computation of withholding payment?
i.
ii.
iii.
e. If more than one provision in the exceptions division covers a payment, how many amounts are to be withheld from the payment?
f. According to Section 388-50 (1) of the Act, what are the four (4) conditions that must be met in order for an activity statement to be considered an approved form?
vii.
viii.
ix.
x.
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Question 14
Answer the following questions about key requirements relating to preparing activity statements under the New Tax System (Wine Equalisation Tax) Act 1999.
a. What is the label of WET payable on your BAS?
b. What is the label of WET refundable on your BAS?
c. What is the percentage of WET on the taxable value of assessable dealings?
d. What ethyl alcohol percentage must products like grape wine and fruit wines exceed to be subject to WET?
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Question 15
Answer the following questions which are specific to the reporting requirements under the A New Tax System (Luxury Car Tax) Act 1999, for the Luxury Car Tax (LCT) and the preparation of the BAS and IAS
a. What is the general luxury car tax threshold for the 2018-19 financial year?
b. What is the luxury car tax threshold for fuel-efficient cars for the 208-19 financial year?
c. At what rate above the luxury car threshold is LCT computed?
d. What is the label of LCT payable on your BAS?
e. What is the label of LCT refundable on your BAS?
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Question 16
Answer the following questions which are specific to the reporting requirements for fuel tax under the Fuel Tax Act 2006.
a. To claim fuel tax credit, what label must be completed on the BAS?
b. What label must be completed on the BAS to make any adjustments that will decrease fuel tax credit entitlement?
c. What tax must businesses be registered for to be entitled to fuel tax credit at the time they acquire, manufacture, or import fuel?
☐ Automotive tax registered
☐ Goods and services tax registered
☐ Luxury tax registered
d. What are the two (2) situations in which a business can claim fuel tax credits?
i.
ii.
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Question 17
If the lodgment day of a required BAS or IAS falls on a Saturday, Sunday, or public holiday, when must the statement be lodged instead?
☐ i. Within one week prior to the set lodgement day
☐ ii. The business day immediately prior to the set lodgement day
☐ iii. The first business day immediately after the set lodgement day
☐ iv. Within one week after the set lodgement day
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Question 18
Explain the three (3) GST principles listed . Each explanation must be 60-100 words.
GST principle Explanation
i. GST Collected
ii. GST Inputs Tax Credits
iii. Net GST Payable
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Question 19
Describe how you can verify or obtain the required information in order to calculate PAYGI for new client you have recently taken on to do BAS work for. Your response should be 50-100 words.
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Question 20
Complete the following table using the space provided for the headings below.
1. Answer – Explain the meaning of the acronym in 20-50 words 2. Reportable – Yes or No or Both answers are required, is the
term reportable on a BAS IAS or both forms.3. Label – What label (section) of the BAS or IAS is each term
reported at
Term Answer (include
full name of
acronym)
Reportable
BAS or IAS or both
Label
TAA
ITAA
PAYG-I (Instalment
)
Including Option 1
and 2
PAYG-W
FBT Instalment
GST Act
FTC
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Question 21
Complete the following table of mistakes/omissions/errors below by;
1. Identifying the “Type” – By indicating if the scenario is an Error, Increasing or Decreasing adjustment
2. What label of the BAS Calculation worksheet is affected? (where would you record the alteration
3. Identify what label is affected on the Activity statements.
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Case Type (Error, Increasing
or Decreasing Adjustment
Item Label – BAS
Calculation Worksheet
Item Label effected
on Activity
Statement
Purchase of $4500
included in the
previous quarter's BAS has
been cancelled
Failure to claim input tax credits
on an invoice of $9900 on
last months
BAS
Supply of $880 from
the last quarterly BAS has now been cancelled
sale of $3300 reported in
a prior BAS has become taxable.
Discovered that 1.5
years ago you
omitted $12000 of
taxable supplies from the
BAS.
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Question 22
Locate the following Tax Ruling GSTR2005/D9 select the correct two (2) responses that best explains what this ruling is about.
☐That GST is not applicable because section 9-5 of the GST Act states new employees become subject to an obligation and a supply.
☐That GST is not applicable because section 9-5 states new employers have an obligation and thus no taxable supply has occurred as it was transferred.
☐That GST is applicable because section 9-5 of the GST Act states new employer become subject to an obligation and a supply.
☐That GST is not applicable because section 9-5 states new employers have an obligation and thus no taxable supply has occurred as it was transferred, thus no new supply is provided by the new employer.
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Question 23
Describe the process for claiming GST credits in a subsequent period (you didn’t include it before) referring to either the accounts methods of calculation sheet method.
Ensure you include in your response;
The calculations you would need to complete (ie the overstated or understated GST, Sales, or Purchase) and subsequent labels that would be affected.
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Question 24
List 2 options you can use to lodge the Activity statement to the ATO provide your response in the space provided below.
For the 2 listed optioned you selected at question 1 describe how you lodge them to the ATO.
List 2 options for lodging the activity statements
Describe how you lodge them to the ATO
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Question 25
Calculate the WET applicable for Drinks R On Us Tavern, who had $450,000 including GST in total sales of which $285,000 was from direct wine sales.
Select (tick box) the correct amount of WET payable for your calculation
☐ $58,245.24
☐ $85,255.24
☐ $82,650.00
☐ $130,500.00
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Question 26
Green Tree Bonsai Pty Ltd is a GST registered company who reports quarterly for BAS. It has come to the attention that the FBT liabilities will increase from 12,000 to 15,000 in the coming year because of more staff and the Fridge benefits the company provides. On the IAS, $3,000 is pre-printed at F1.
Calculate the varied FBT instalment amount payable on the March activity statement and select using the tick box below the correct value.
☐ $2,000
☐ $6,000
☐ $12,000
☐ $5,000
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Question 27
Paula is completing her IAS and is working on the PAYG Instalment section due to changes in economic circumstances is having to vary his instalment payments. She calculates using option 2 and gets a rate of 9%, the pre-printed amount given by the ATO on the IAS is 5 % which rate must she use?
Select from the below using the tick box the correct response to this situation.
☐ She can’t vary the rate
☐ She must use the ATO rate of 5%
☐ She must use the 9% percent as the varied rate is higher than the pre-printed amount
☐ She must contact the ATO to get a decision on this matter
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Unit of Competency FNSTPB401 Complete Business Activity and Instalment Activity Statements
Workbook Part B – BAS and IAS Questions
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FNSTPB401 Complete Business Activity and Instalment Activity Statements
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