Tax Codes Usage

It can sometimes be difficult to determine the appropriate tax code to use. This article explains the different tax codes for use in bookkeeping, and gives some examples of when they might be used.

GST – Goods & Services Tax

  • GST transactions where claimable by the business

FRE – GST Free

  • Bank cheques
  • Payments to suppliers who have an ABN but who are not registered for GST
  • Donations
  • Interest expense
  • Australian Securities & Investment Commission fees
  • GST free food items & other free items under the act
  • Overseas expenses where the total ST is not paid via the Customs Agent

INS – Input Taxed Sales

  • Interest income
  • Residential rent received

INP – Input Taxed Purchases

  • Expenses where an input tax credit is available however is prohibited under the act to claim the GST because those expenses deemed input taxed e.g., residential rent expenses
  • Expenses to financial suppliers

N-T – Not Reportable on BAS

  • Wages
  • Superannuation
  • Tax payments
  • Fines
  • Shareholder loans
  • Dividends received/paid
  • Depreciation
  • Principal payments on finance
  • Private expenses, or private portion of expenses that are not tax deductible
  • Non deductible entertainment

CAP – GST on Capital Acquisitions
CFE – Capital Acquisitions FRE of GST

  • Capital purchases e.g., plant & equipment
  • Capital purchases bought overseas

EXP – Export Sales

  • Sales to overseas customers


Comments are closed.