In Singapore, it is compulsory for businesses with turnover exceeding $1 million per year to register for Goods and Services Tax. Being a GST registered company, you will enjoy claiming 7% of input tax from IRAS for business expenses or purchase incurred by you. However, the downside is that you will need to collect output tax from your clients for revenue generate by sales of your goods and/or services.
Once you have registered for GST, you must charge GST on your supplies at the prevailing rate with the exception of relevant supplies that are subject to customer accounting. This GST that is charged and collected is known as output tax. Output tax must be paid to IRAS.
The GST that you incur on business purchases and expenses (including import of goods) is known as input tax. If your business satisfies the conditions for claiming input tax, you can claim the input tax on your business purchases and expenses.This input tax credit mechanism ensures that only the value added is taxed at each stage of a supply chain.
Paying Output Tax and Claiming Input Tax Credits
As a GST-registered business:
- You must submit your GST return to IRAS one month after the end of each prescribed accounting period. This is usually done on a quarterly basis.
- You should report both your output tax and input tax in your GST return.
- The difference between output tax and input tax is the net GST payable to IRAS or refunded by IRAS.
GST Report Under Deskera Books
Deskera Books allows you to generate your GST report for all the Purchases and Expenses with GST and Sales and Deposit with GST. This accurate report will be helpful for further filing the GST returns to IRAS with no errors.
Below are the steps mentioned:
- Go to the ‘Reports’ on the sidebar menu. Click on the GST Report under the Tax section.
2. A Screen will with all the automated GST report as per the GST sales and purchase transactions in the system, with the fields like, Amount Without Tax, Tax Amount, Amount With Tax.
3. If you want to generate a detailed report for Purchases and Sales transaction, click on the Details button available next to each transaction line item. Following details will pop up,
4. Select the date range you wish to generate the report
Once you have generated the GST Report, you may submit the file to IRAS.