Step 1 – Record your BAS as a purchase bill
Note: in this example, the client pays quarterly GST and monthly PAYGW and therefore will be eligible to receive a credit equal to 300% of his/her March PAYGW, ie. 3 x $3,000 = $9,000
The ATO will offset the $9,000 against the March quarter BAS in the Integrated Client Account and transfers a $4,000 refund into their nominated bank account.
Step 2 – Record a Credit note in Xero for the ATO credit
Step 3 – Apply this credit to your outstanding March quarter BAS
The remaining $4,000 of the ATO credit can be either applied against your future lodgements or the ATO will deposit this amount into your nominated bank account. (example below)
Step 4 – Reconcile refund received from the ATO (or remaining payment on BAS)