BAS – What you need to know about Business Activity Statements
We’d wager that a love of bookkeeping was not amongst the many reasons you went into business. But, unfortunately, it is a necessary evil once your business reaches a certain level of success. Amongst the plethora of other accounting acronyms, you will likely recognise BAS, also know Business Activity Statements.
What is BAS?
Business Activity Statements are Government forms which are lodged with the Australian Tax Office (ATO). They are designed to simplify your reporting on four key factors:
- PAYG (Pay as your Go) instalments;
- PAYG withholding tax; and
- Other taxes
The good news is, if you are not registered for GST then you don’t need to worry about BAS. But, if you are required to lodge BAS or are likely to be soon, then here is the information you need to know.
When do you need to lodge a BAS?
BAS is lodged monthly, quarterly or annually with the ATO.
How often you lodge is entirely dependant on you. But, remember, even if you have nothing to report, you must still lodge your BAS by your designated date.
To make it easier to remember when you need to lodge, we have created this calendar of important dates.
What information do you need to report?
The information you need to report when lodging your BAS is affected by the type of business and collateral you have. It is also dependant on the when you are lodging.
But, as a general rule, the types of information you need to report include:
- PAYG income tax instalments;
- PAYG tax withheld;
- Fringe benefits tax instalment;
- Luxury car tax and fuel tax credits;
- Instalment notices for GST and PAYG instalments; and more.
How to lodge BAS
In the last couple of years, registration has become even easier with three convenient methods.
- Lodgement by post.
You can request a Paper BAS by phoning 13 28 66. Lodgements need to be sent to:
Australian Taxation Office
Locked Bag 1936
Albury NSW 2640
- Lodge online
Concessions and payment extensions are available to those who lodge their BAS online. If you are a sole trader you can lodge your BAS by logging in to your myGov account.
If you are registered business, you will need to use the myGOVID app to access the Business Portal.
- A registered tax or BAS agent can also lodge your BAS on your behalf.
To make it extra convenient, once you have registered for GST the ATO will automatically send you a Statement to complete.
How to Pay BAS
All BAS payments are now to be paid electronically i.e. cheques will no longer be accepted.
The quickest payment method is BPAY using your payment reference number.
Other options are to log into your myGOV or Business Portal and pay via credit or debit card.
To avoid potential interest charges or penalties, you must pay your BAS on time. Payments can be made in advance. For more information on how to pay, head to the ATO website.
- Keep accurate records of all invoices sent, PAYG, business expenses etc. Accounting software such as Reckon, QuickBooks and MYOB can help you curate these.
- Know your lodgement dates and plan ahead. Start collating all the documentation a week ahead so that you are not rushing the day your BAS is due. And, remember, if you are lodging by mail, ensure you allow for the extra postage time.
- Keep copies! Receipt paper fades very quickly, so taking photocopies will help you avoid headaches if the receipts become illegible. Also, be sure to take a copy of your BAS statement before posting.
The ‘do nots’ of BAS
As tempting as it is to be an ostrich and bury your head in the sand when you see your BAS debt, it is not a good business practice. If you run into some financial trouble and are unable to make your payment on time, it is best to contact the ATO to arrange a payment plan.
To make it easier to work out your payments, the ATO has created a payment plan estimator.
For more helpful tips, please see this video created by the Australian Tax Office.
If all of this information is overwhelming, or if you need some help lodging your first couple of Business Activity Statements, then please call us at Synergy Accountants and Estate Planners. We are a registered BAS agent and are always happy to offer assistance and advice to business owners.
* The abovementioned advice is true and correct as at the date of publication. The information contained in this blog is to be considered a guide only and is not intended to be used in lieu of advice received from your registered accountant or tax agent.