NewOZ

if a Client will pay $44 per hour including GST to the Agent and the Agent will pay $33 per hour including GST to the Contractor,
in this case will the agent pay GST the government for the $44 or for $11 ?
i.e. will the Agnet pay $4 per hour GST or Just $1 per hour GST

Shakmaty

If the client pays the cash to the agent, then the agent is liable for all the GST, ie $4. But when they pay the contractor, the amount including GST will be offset at reconciliation time.

Wendy

Invoices or Receipts will have been collected by each person or business over the course of their accounting period. Any GST paid out will be deducted off the amount of GST charged to determine that persons or businesses GST liability over the period.

So you pay or claim GST on the amount you charge or are charged. What any of your suppliers or clients charge has nothing to do with it.

Wendy

And that sounds so much simpler to what I put.

Shakmaty

I just read it

I understand what you were trying to say.....I think

Wendy

Well, it made more sense that the OP

Just

Shakmaty

What is this? The thread

Wendy

Shakmaty

NewOZ

So the agent has to pay in the end $1 GST per hour, right?!!

Shakmaty

From this deal, then yes, the agent pays $1 GST. He claims to have been paid $4 dollars GST, but has paid out $3 GST so is $1 GST in credit.

mand8002

GST payable to the ATO = GST Collected - GST Paid as long as they are GST registered

Timber Floor Au

However if the end user ( employee ) and were abn registered, you could ofset the gst output liable against any gst inputs.

So on and so forth..

However just to get a tad quirky..

How come in UK you pay VAT on reclaimed building materials, that were sold originally inc vat? Surely the government are fiddling the taxman