How To

Client Agent Linking – Useful Links, Videos & Phone Numbers

BAS Agent's Blog, Client Agent Linking, How To / By / / , , / 2 minutes of reading

In a previous blog, I discussed the challenges agents and clients face because of Client Agent Linking (CAL). Many of the issues encountered are related to setting up various digital identity software and/or not understanding the CAL process. In this blog, I will share useful links, videos and phone numbers to help those stumbling through this difficult task! 

As mentioned, the CAL process is complicated. It involves setting up a myGovID, linking the ABN to the myGovID in Relationship Authorisation Manager (RAM), logging into Online Services for Business (OSB), nominating a new agent and finally advising the agent that the nomination has occurred. The links to assist with setting up myGovID, RAM and OSB are below, along with a step-by-step guide to CAL both in written and video format. Some phone numbers are listed for those who prefer to call a human being! I hope this helps those who are struggling with CAL.

  1. How to nominate an agent in online services for business (download)
  2. The agent nomination process explained
  3. Troubleshooting guide for agents
  4. How to set up myGovID
  5. Online services for businesses
  6. Relationship Authorisation Manager (RAM)
  7. Link your myGovID to your ABN
  8. For agents – think before you link!

CAL – Useful Phone Numbers

  1. ATO – help with nominating an agent or with online services for business – 132866
  2. ATO – help with late lodgements and payments due to not being able to link to an agent – 1300 660 048
  3. ATO – agent can’t link a new client in online services due to a system error – 137286 (only call if the client has completed the nomination process)
  4. RAM – 1300 287 539 (select option 3 for RAM enquiries)
  5. myGovID – 1300 287 539 (select option 2, then option 1 for myGovID enquiries).

CAL – Useful Videos

ATO Client-To-Agent Linking Steps: How to nominate an agent in Online Services for Business

Client / Agent Linking – An ATO How-To Tutorial

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How to Series No 4 – How to Account for Hire Purchases

BAS Agent's Blog, How To / By / / , , / 3 minutes of reading

This is the fourth part in a series I’m calling “How-To”. The first part was about insurance bills, the second part was about VicRoads registration bills and the third part was about chattel mortgages. I will be using Xero for the example, but don’t worry if you use another software, the basic rules will still apply. 

The fourth how-to is about how to account for hire purchases in your accounting software. A hire purchase arrangement is an agreement to purchase goods in instalments.

Step 1

Let’s pretend that your business has purchased a new printer with all the bells and whistles for $15K via a hire purchase agreement, plus $5,000 interest.  For this example, the hire purchase is for 30 months without a residual (balloon) payment at the end of the period. Note, that most hire purchase agreements will include a balloon component (check your documentation). The first thing to do is collect all of the documentation. You will need the hire purchase agreement, the invoice, and the interest amortisation schedule. The hire purchase company will provide all of this to you at the point of purchase. To begin the process, create some accounts in your accounting software:

  • Office Equipment (Asset GST Inc)
  • Hire Purchase Unexpired Interest (Liability GST Inc)
  • Hire Purchase Liability (Liability BAS Excluded)
  • Interest Expense – Hire Purchase (Expense BAS Excluded)

Note, For any Hire Purchase Agreement made after 1/7/2012, both the purchase price of the asset and all interest charges and fees are subject to GST. (see notes at the end of the blog)

Step 2

Now you can enter this journal which adds the purchase of the printer into the accounts:

Check your balance sheet. It should look like this:

Step 3

When it comes time to record the first repayment to the finance company, your entry will look like this (assuming each repayment is $500 (30 x $500 = $15K)). Note, that the tax code for the interest expense account is BAS Excluded. This is because the GST on the interest component of the hire purchase was claimed when the purchase was entered initially (see journal). Therefore the monthly repayments of interest are not reportable on the BAS.

Step 4

Check that the balances in the balance sheet are reduced by the first repayment – see below. Note that I have evenly split the interest repayments into amounts of $151.51 for this example ($4,545.45 divided by 30 payments). However, you will need to enter the interest amounts as per your amortisation schedule and these won’t be exactly the figures divisible by the number of repayments. Something to keep in mind!

GST rules for hire purchases

For hire purchase agreements entered into on or after 1 July 2012, all components of the transaction are subject to GST including:
• The upfront purchase price of the asset financed under the agreement
• Interest charges, and
• Any other associated fees.

This is the case regardless of whether you account on a cash or accrual basis.

This means that taxpayers on a cash accounting basis can claim the full amount of any available GST credit at the time the first payment is invoiced or paid under the hire purchase.

This was the last part of our How-To series (for now). I hope you found this series useful. For further details about hire purchase agreements and GST, go to this ATO webpage.

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How to Series No 3 – How to Enter a Chattel Mortgage Asset Purchase & Loan

BAS Agent's Blog, How To / By / / , , / 2 minutes of reading

This is the third part in a series I’m calling “How-To”. The first part was about entering insurance bills and the second part was about how to enter a VicRoads registration bill. I will be using Xero to present the example, but don’t worry if you use another software, the basic rules will still apply. 

The third how-to is about how to enter a Chattel Mortgage asset and associated loan into your accounting software.

Step 1

Let’s say your business has purchased a new motor vehicle. The invoice from the vehicle dealer might look something like the below example. Grab your invoice now.

Step 2

The finance company loan schedule is also required. It may look something like the below example. Grab you loan schedule now.

Step 3

Create the following accounts in your software (check first because some may already exist):

  • Deposit Paid (Current Asset) – no tax code
  • Motor Vehicles at Cost (Non-Current Asset) – apply capital expense including GST tax code
  • Chattel Mortgage (Motor Vehicle) (Non-Current Liability) – no tax code
  • Chattel Mortgage Interest Charges (Expense) – no tax code
  • Chattel Mortgage Fees & Charges – tax code varies, could be Free or GST inclusive (check your documentation)
  • Motor Vehicle Registration (Expense) – apply GST Free tax code
  • Motor Vehicle Insurance (Expense) – apply GST inclusive tax code
  • Unexpired Term Interest (Non-Current Liability) – no tax code

Step 4

First enter a spend money transaction to record the payment of the deposit:

Step 5

Next, enter this journal to record the purchase of the new vehicle:

Step 6

When it comes time to make a repayment to the finance company, enter a spend money transaction like this:

Bonus Tip!

Sometimes it isn’t possible to obtain the loan repayment schedule for whatever reason. When this happens, you need to create your own. I use this amortisation calculator by Bret Whissel. It has served me well over the years. I hope you find it useful too.

Next week for part four of this How-To series, I will cover how to set up a Hire Purchase agreement in your accounts. Until then, happy bookkeeping!

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How to Series No 2 – How to Enter VicRoads Registration Bills

BAS Agent's Blog, How To / By / / , , , / 3 minutes of reading

Last week, I started a bookkeeping resource series called “How To”. Each week I will share instructions with you about how to enter some common transactions. I will be using Xero to present the example, but don’t worry if you use another software, the basic rules will still apply. Last week I explained how to enter an insurance bill.

The second how-to is about how to enter a VicRoads registration expense/bill into your accounts.

Step 1

Grab your VicRoads bill and go to the part where it shows you the breakdown of charges. It may look something like this:

Step 2

Log into your software and go to the area where you enter bills.

Step 3

Enter the VicRoads as the supplier, the relevant dates and the reference number or name as below:

Step 4

Enter a line in the bill for each charge shown on the bill. The registration fee is GST-free, the TAC charge includes GST and the insurance duty is BAS Excluded. If you are entitled to claim 100% of motor vehicle costs in your business, then you can claim the full GST amount on the TAC charge. Time and time again, I see clients entering the full amount of the registration expense as GST-free. While they are partly right, they are also missing out on claiming the GST of the TAC charge. Also, relevant here is the choice of account for expense coding – you may like a general account such as this one “Motor Vehicle Expenses”, or you may like to split your costs out in a more detailed manner and have an account for each type of car expense, in this case, “Motor Vehicle Registration”. It just depends on how much detail you want to see in your profit and loss report.

Step 5

Check that the GST amount agrees with the VicRoads bill. In this case, it is $40.00.

Step 6

Approve the bill to ensure the expense is added to the accounts correctly.

Final words…

So that’s it for this week’s “how-to”. I hope you learned something new. One thing I’d like to add about VicRoads “bills” before I close off this blog, is that to obtain an actual bill, you do have to have an account with VicRoads. They used to send out the document in the mail, but not anymore – it’s all online, like everything these days. Here’s the link to VicRoads where you can make an account if you haven’t already done so.

Bonus Tip!

For any bookkeepers out there who know the pain of not ever receiving an actual VicRoads bill from clients (who probably don’t know how to get it – see notes above), which makes data entry nearly impossible, here is the link to the TAC registration rates for FY24. This document provides the breakdown of TAC and insurance duty fees based on postcode and vehicle type. An excellent resource that I am sure you will use time and time again. There is also an online calculator you can use on the VicRoads website that will provide the figures you need easily. Here is the link for the calculator. Either resource will get you the information you need. You’re welcome by the way!

Next week I will show you how to enter a chattel mortgage loan. Until then, have a happy week.

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How to Series No 1 – How to Enter an Insurance Bill

BAS Agent's Blog, Bookkeeping, How To / By / / , , / 2 minutes of reading

This week, I am starting a bookkeeping resource series called “How To” (not very original, I know!). Each week I will share instructions with you about how to enter some common transactions. I will be using Xero to present the example, but don’t worry if you use another software, the basic rules will still apply.

So here goes, the first how-to is about how to enter an insurance bill into your accounts the right way.

Step 1

Grab your insurance bill and go to the part where it shows you the breakdown of charges. It may look something like this:

Step 2

Enter a line in the bill for each charge shown on the bill. In this case, there is one for the premium and one for the stamp duty component. Select the insurance account you want to use – you may have one for business insurance and another for motor vehicle insurance etc. Notice that the premium figure is plus GST, whereas the stamp duty is BAS excluded. This is because stamp duty does not attract GST. It is very important to break up your insurance bill like this and to never enter a bill 100% inclusive of GST. Doing so will mean that you overclaim GST in your BAS.

Step 3

Check that the GST amount agrees with the insurance bill. In this case, it is $38.25 which is one cent less than our bill, hence the rounding line I have added to agree the total amount with the supplier’s bill.

Step 4

Approve the bill to ensure the expense is added to the accounts correctly.

Final Words…

So that’s it for this week’s “how-to”. I hope you learned something new. Please note that this insurance example is pretty basic. Some insurance bills have extra charges which may or may not include GST. The trick to getting these sorts of more complex bills entered correctly is to ensure the GST figure in the bill agrees with your software entry. If it doesn’t, you need to check each charge for its GST status i.e. some items will include GST and others may be GST-free or GST-exempt.

Next week I will show you how to enter motor vehicle registration bills. Until then, have a happy week.

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