Understanding forecast amounts and GST
Learn how GST affects forecast amounts, when GST should be included in forecast entries, and how to ensure forecast values accurately reflect expected cash movement.
Forecasting the money that actually move
Cashflow forecasting is designed to help you understand how much money is expected to move into and out of your business over time.
When creating forecast entries, the amounts entered should reflect the actual cash amount expected to be received or paid, including GST where applicable.
Understanding how GST affects forecast amounts helps ensure your cashflow forecast accurately reflects expected bank movements.
Forecasting Follows Cash Movement
Forecasts are designed to represent expected cash movement rather than accounting treatment.
When entering forecast amounts, think about:
- How much money will be received?
- How much money will be paid?
- When will the money move?
The amount entered should reflect the total cash movement expected.
Include GST Where It Applies
Enter the full expected cash amount when GST applies.
Example:
If a customer is expected to pay:
- $1000 plus GST
- $100 GST
The expected receipt is:
- $1100
The forecast amount should therefore be entered as $1100 because that is the amount expected to arrive in the bank account.
Avoid Adding GST Twice
If an amount already includes GST, do not add GST again
Example:
- Expect receipt = $1100 -> Enter $1100
- Expected receipt = $1100 -> Enter $1210
The forecast should reflect the actual expected cash movement.
Not Every Payment Includes GST
GST does not apply to every payment type.
Before entering forecast transactions, ensure the amount reflects the actual expected payment rather than automatically adding GST.
Review supplier invoices, contracts or supporting documentation where appropriate.
Work, Milestones and GST
When reviewing Work in Progress (WIP), ensure the scheduled milestone amounts reflect the cash movement you intend to forecast.
A work record's total value alone does not create a forecast contribution.
Forecast values are driven by scheduled milestones.
Review:
- Milestone amounts
- Scheduled dates
- Forecast timing
- Expected receipt and payment values
before relying on forecast outcomes
GST and BAS Are Different Concepts
Forecasting GST inclusive cash receipts and payments is different from forecasting BAS obligations
For example:
- Customer receipts
- Supplier payments may include GST
- BAS payments or refunds may occur separately
A forecast transaction should only represent the cash movement it was intended to capture.
Unsure Whether GST Has Already Been Included?
Before adding additional forecast transactions, review the existing forecast carefully.
Check:
- Forecast amounts
- Related work records
- Milestone schedules
- Existing projected transactions
This helps avoid accidentally duplicating forecast amounts.
If you're unsure how a GST payment, refund or adjustment should be represented, contact support before creating additional entries.
Better Forecasts Through Better Inputs
The most useful forecasts begin with accurate amounts.
When entering forecast transactions:
- Use the actual expected cash amount
- Include GST where it applies
- Avoid adding GST twice
- Review milestone schedules
- Check existing forecast entries before creating new ones
By focusing on expected cash movement, your forecast will provide a more reliable view of future cashflow.