As a business owner in Australia, you will need to complete and submit the business activity statement or BAS at the specified time of the financial year. Like other reporting and administrative tasks, this task can also be very complicated if you cannot organise things in advance. Staying on top of the accounts throughout the whole year can make your job of preparing and submitting the BAS much easier and smooth.
If you wish, a professional BAS agent can help you with it. If you do not like to hire a separate agent, you can ask your bookkeeper or accountant to look after the BAS obligations. This write-up will give you a detailed guide about the BAS that may be beneficial to you.
What Is A BAS (Business Activity Statement)?
You may wonder when you will need to lodge a BAS. A business activity statement will be required to submit when a small business is registered for Goods and Services Tax (GST). This statement is nothing but a summary of the revenue of a business and key expenses over a period.
It helps an owner pay and report taxes, including GST, PAYG instalments, FBT (Fringe Benefits Tax) instalments, PAYG withholding tax, wine equalisation tax, luxury car tax, etc.
What Kind Of Businesses Are Required To Lodge A Business Activity Statement?
If your business is registered for GST, you have to lodge a BAS. But, when should you register for GST? That will be required if you satisfy the following conditions.
- The annual business income is $75000 or more. And, if your business is a non-profit organisation, the yearly income should be $150000.
- Taxi travel is a part of your business, where passengers are transported by limousine or taxi.
- You wish to claim fuel tax credits.
But what if your annual business income is under $75000? Well, in that case, it will not be mandatory to register for GST, but if you wish, you can.
When Should You Lodge Your BAS?
On each BAS statement, the due date for paying and lodging the BAS will be displayed. The reporting and payment cycle for the GST can be one of the following, based on your annual GST turnover.
If your business has a GST turnover of less than $20 million, the ATO may not ask you to submit monthly statements. For quarterly submission of GST, the due date in each quarter will be as follows.
- For the quarter of July, August, and September, the due date is 28 October.
- For the quarter of October, November, and December, the due date is 28 February.
- For the quarter of January, February, and March, the due date is 28 April.
- For the quarter of April, May, and June, the due date is 28 July.
If your annual GST turnover equals $20 million or more, you will need to submit the BAS monthly. The due date falls on the 21st day of the month after the taxable period ends. Thus, the January BAS should be lodged on 21 February.
If the annual GST turnover is under 75000, you will need to submit your BAS on 31 October every year. You can either choose lodging the business activity statement yourself or working with any registered BAS agent. The benefit of hiring an agent is that you will get an extended deadline. But, before hiring such a person, you should check whether they are registered with the Tax Practitioners Board.
How Can You Lodge Your Business Activity Statement?
When it comes to submitting the business activity statements, you can have several choices. If you lodge your own BAS, you can use the following methods.
- Using the MyGov portal
Do you own a sole trader business? If yes, you can submit and revise your business activity statements from your MyGov account.
- Using the business portal in the ATO
If your business is not a sole trader, business tax affairs can be managed here.
- Using online accounting software
There are several online accounting software such as MYOB and Xero, where you can directly lodge your BAS. You can do it using your accounting portal. But one thing to remember is that the accounting software should be SBR-enabled (Standard Business Reporting-enabled).
What Can Happen To A Late BAS Submission?
Are you finding it challenging to submit and pay your BAS by the due date? If yes, you must contact the Australian Taxation Office as early as possible. They can help you by setting up a definitive payment plan for you. In that case, you may have to pay the amount through instalments. But remember, you will still need to submit the BAS within the proper time.
Do You Have To Pay Penalties If You Submit The BAS Late?
If you cannot lodge and pay the business activity statement on time, the ATO can ask you to pay the FTL on time penalty. FTL stands for failure to lodge. But the Taxation Office will first send you a warning through phone or writing and then a penalty notice if the situation is not rectified. This is the reason why we recommend hiring a registered tax agent for the BAS submission.
What If You Make A Mistake On The BAS?
Do you think you have committed a mistake on your BAS that is already lodged? In that case, you can fix the error on the next BAS or revise the original one. How you can fix the error will depend on whether the error is regarding credit or debit. For guidelines, you may check on the ATO website. Whatever the period of lodgement may be, you should always keep your accounts up-to-date. You must eye on completing the statement at least seven days before the due date so that you can have sufficient time in your hand for the submission.
You will need to concentrate more on preparing the business activity statement. And for that purpose, it is advisable to have a registered accountant. Leading tax firms can help you get the best tax agent in Perth to deliver the best efficiency in completing the statement.