Answer To: Activity 16 1 A supplier carrying on an enterprise invoices the business for $200. The invoice does...
Sumit answered on Feb 04 2021
1.
When a buyer purchases any goods from the seller the seller needs to quote the Australian Business Number (ABN) on the invoice for the goods or services that are being supplied. The buyer should first request the seller to provide the Australian Business Number (ABN). If the supplier does not provide his Australian Business Number (ABN), then the buyer should withhold some amount from the total payment to be made to the seller. The amount to withhold is the based on the top rate of tax and the remaining payment can be made to the supplier.
Since the Invoice value in the transaction is greater than $75 (excluding GST), the withholding of tax till the Australian Business Number (ABN) is provided is applicable. Hence the buyer should withhold the amount of GST calculated using the Highest Tax Rate and make the remaining payment. The amount of deduction to be made is 46.50% of the invoice amount, i.e., $93. Hence the payer can make payment of $107 to the supplier and withhold the...