XBert Type: Standard
Accounting Software: Xero, MYOB
Country Restriction: AU only
Risk Type: Tax Risk
Business Function: Contacts
Overview
The "Business Has Incorrect GST Status" XBert identifies supplier contacts in your accounting system that are set to apply GST on purchases, even though the business is not currently registered for GST on the Australian Business Register (ABR). This helps ensure you’re not incorrectly claiming GST on your Business Activity Statement (BAS), which could result in compliance issues and financial penalties.
What it does
This XBert checks supplier contact records marked to apply GST by default and cross-checks their ABN against the ABR. If the business is active but not registered for GST and there has been any recent financial activity with that supplier, an alert is triggered. This allows you to review whether GST should have been charged or claimed.
How it works
XBert analyses active supplier contacts in Xero where:
GST on Expenses is set as the default tax rate.
The ABN is matched to a business on the ABR.
The business is not currently registered for GST.
There has been any journal activity recorded for that contact.
The alert highlights a risk that you may be claiming GST from a supplier not authorised to charge it. While XBert cannot yet determine the GST de-registration date, it flags this based on the most current registration status.
Example/Use Case
Your business has worked with a supplier for five years. Recently, the supplier deregistered for GST without informing you. You continue paying their bills with GST included, expecting to claim it back in your BAS. A few months later, the ATO audits your return and sends an invoice for the GST you weren’t entitled to claim. You’re now forced to repay the ATO and chase the supplier for a refund, tying up your cash flow and creating unnecessary financial pressure.
Accounting software
All Australian-compatible accounting software (e.g., Xero, MYOB).
Which countries it supports
Australia only.
Processes
This alert falls under the ‘Cleanup’ process category and is focused on preventing inaccurate GST claims. To resolve this issue:
Search for the supplier’s current GST registration using the ABN Lookup website.
In your accounting software, update the supplier’s contact record and change the default GST treatment for purchases if needed.
Request a revised invoice from the supplier that excludes GST if they are not registered.
Adjust any existing bills or transactions to remove GST if incorrectly applied.
Review your BAS lodgements to ensure no incorrect credits have already been claimed, and seek a refund or credit from the supplier if necessary.