Are you a beginning business owner in Australia? How well-informed are you about your tax requirements?
If you registered for Goods and Services Tax (GST), you must lodge your business activity statements (BAS). The mere mention of BAS is enough to make most firmsnervous, but much of their worry is due to a lack of understanding of this official document.
ATO compliance services can help with the reports, but what is BAS, and why is it so important?
As mentioned, BAS stands for business activity statements. These statements are issued by the Australian Taxation Office (ATO) to all companies registered for GST.
In layperson’s terms, the BAS summarizes all the taxes you have paid or will pay to the government during a certain period.
What is Included in the BAS?
The BAS sounds like a simple form, right? While it simply reports your debts to the ATO, recording and managing the necessary information is challenging. You must registerthe correct numbers to ensure a successful BAS report.
The ATO recommends keeping complete and precise records of the following:
- Fees and expenses
- Other costs
- Goods and Services Tax (GST)
- Fringe benefits tax (FBT) instalments
- Pay as You Go (PAYG) income tax instalments and tax withheld
- Wine equalisation tax (WET)
- Luxury car tax (LCT)
- Fuel tax credits
You can claim the business portion of any GST purchases, but you cannot claim credits for private expenses. If your expenses are personal and for business, only the latter is claimable.
How Often is BAS Lodged?
The due dates for lodging your business activity statements are shown on the form. ATO typically issues this monthly or quarterly, and must be lodged and paid according to the specified deadline.
However, online filings do not show the due date on the form. Depending on your cash flow, here are the reporting and payment cycles for the GST:
- Monthly – $20 million GST turnover or more. The due date is within 21 days of the end of the month.
- Quarterly–Less than $20 million GST turnover
- Annually–Less than $75,000 (less than $150,000 for non-profit); voluntary registration for GST. This is not recommendeddue to a high risk of lack of cash.
If you choose a quarterly payment, the deadlines are as follows:
- Quarter July – September: 28 October
- Quarter October – December: 28 February
- Quarter January –March: 28 April
- Quarter April – June: 28 July
Remember that due dates may be affected by holidays, natural calamities, and other unforeseeable events.
How to File BAS Correctly
Managing your BAS can be a daunting task. To help you maintain accurate and up-to-date business activity statements, here are several tips:
- Record and organise all business transactions immediately and according to form categories
- Consolidate and prepare all accounts
- Stay aware of the BAS lodgement deadlines
- Compute the tax according to your BAS
How Compliance Services Can Help
We understand that you may still be overwhelmed trying to learn about BAS. It is normal for beginner business owners to be confused about the Australian Tax Code, but that does not mean you should struggle.
Don’t hesitate to approach Pacific Accounting for professional ATO services. Their expert team of accounts will help you process your BAS and other obligations to the ATO, ensuring you remain compliant. Contact 1800 1800 98 to get started.