BAS - Business Activity Statement
A Business Activity Statement (BAS) is like a regular report card for your business’s taxes.
A Business Activity Statement (BAS) is like a regular report card for your business’s taxes, summarizing your interactions with the Australian Taxation Office (ATO). It’s a form businesses use to report and pay various taxes. Think of it as a consolidated bill covering your business’s tax obligations for a specific period, typically quarterly.
Key Components of a BAS
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GST (Goods and Services Tax): This is a 10% tax on most goods and services sold or consumed in Australia. Your BAS shows how much GST you’ve collected from customers and how much GST you’ve paid to suppliers. The difference is what you owe to (or receive from) the ATO.
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PAYG Withholding: This refers to the tax you withhold from your employees’ wages or salaries. You report and pay this to the ATO on behalf of your employees.
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PAYG Instalments: These are regular prepayments of your income tax. They help you avoid a large tax bill at the end of the financial year by spreading your tax payments throughout the year.
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Fringe Benefits Tax (FBT): If you provide fringe benefits to your employees (like a company car or health insurance), you may need to pay FBT. This is reported on your BAS.
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Other Taxes: Depending on your business activities, you may also need to report other taxes on your BAS, such as fuel tax credits, wine equalisation tax, or luxury car tax.
Who needs to lodge a BAS?
Most businesses registered for GST need to lodge a BAS. The frequency of lodging (monthly, quarterly, or annually) depends on your business’s turnover and other factors. The ATO will notify you of your lodging frequency.
Quarterly reporting
| Quarter | Period | BAS Due Date |
|---|---|---|
| Q1 | 1 July – 30 September | 28 October |
| Q2 | 1 October – 31 December | 28 February |
| Q3 | 1 January – 31 March | 28 April |
| Q4 | 1 April – 30 June | 28 July |
How do you lodge a BAS?
You can lodge your BAS online through various methods, including:
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Business Portal: The ATO’s online platform specifically designed for businesses.
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Tax agent portal: Through a registered tax agent.
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Accounting software: Many accounting software programs allow you to lodge your BAS directly including Gimbla Accounting Software.
What information do you need to complete a BAS?
You’ll need records of your business transactions, including:
- Sales and purchases (including GST amounts) Wages and PAYG withheld
- Fringe benefits provided to employees
- Any other relevant tax information
| Total Sales | Tax On Sales | Total Purchases | Tax On Purchases | ||
|---|---|---|---|---|---|
| 📒 Free | 200.00 | - | 40.00 | - | |
| 📒 GST 10% | 550.00 | 50.00 | 100.00 | 9.09 | |
| TOTAL | 750.00 | 50.00 | 140.00 | 9.09 | |
Accurate record-keeping is essential for completing your BAS correctly.
What happens if you don’t lodge your BAS on time?
Lodging late can result in penalties and interest charges. It’s crucial to meet your lodgement deadlines to avoid these unnecessary costs. If you anticipate difficulty lodging on time, contact the ATO as soon as possible to discuss options.
Conclusion
Completing and lodging your BAS correctly and on time is crucial. It ensures you meet your tax obligations and avoid penalties. While it might seem complex, understanding the basic components can make the process less daunting. If you’re unsure about any aspect of your BAS, seeking professional advice from a registered tax agent or the ATO is always recommended. They can guide you through the process and ensure your business remains compliant with tax laws.