If you’re a small business owner and you’re registered for GST, you’ll know that you are required to lodge a Business Activity Statement (BAS) every month or quarter. This can be a time-consuming and sometimes confusing process; so for those who are new to it, here are some tips and tricks for how to complete your BAS as accurately and quickly as possible.
What is a BAS?
A BAS is the document used to summarise the amounts of GST and other taxes payable and receivable by you, either monthly or quarterly. It is issued by the Australian Tax Office (ATO) and allows your business to report and pay various taxes in one go. It will include some or all of the following:
- PAYG (withheld and income tax instalment)
- Instalment notices for GST and/ or PAYG
- Fringe Benefits Tax instalment
- Fuel tax credits
Your BAS must be lodged by the 21st of each month if you pay monthly, or the 28th of October, February, April, and July if you pay quarterly. If you are late lodging your BAS you can be charged $110 for every 28 days, or part thereof, that your BAS is late.
You can lodge your BAS online, by post, by phone, or through your accountant.
Important Things to Check
In order to prepare your BAS as efficiently as possible and save yourself time, it’s important to check some vital areas where people often make mistakes.
1. Make sure you are using the correct tax codes. You’ll need to set these up on your accounting software, so it’s advisable to get your accountant or a BAS agent to check them before you start using your software.
2. Make sure you know what expenses and sales you can claim GST against, as some items are not eligible.
3. Remember to include ALL sales and purchases. If they have been paid in cash, you need to include them and keep receipts as proof. Sales of capital, including vehicles or office equipment, also need to be included, even if it was a trade-in.
4. If you employ staff, you need to complete the W1 and W2 sections of the BAS. Wages must be included in W1, not as an expense in G11.
- If you choose the right GST reporting option, you can simply pay a GST instalment each quarter, without having to do any calculations. You can calculate your GST amounts when you lodge your tax return at the end of the year.
- Registering for an AUSkey on the ABR website will also save you time as it allows you to access the ATO’s online services. All you have to do then is log into the ATO Business Portal each quarter to complete your new BAS. Registration is free at www.auskey.abr.gov.au