Simplified Guide To Business Activity Statement (BAS)

Are you a newbie to the world of business finance? You might be unsure about the fact that when your tax lodgments are due! The Australian tax code might seem a little bit convoluted for anyone who’s not well-acquainted with its various facets. 

However, it’s still crucial that every business must have a fundamental understanding of the business terms, GST, BAS, and other indispensable elements. So, in today’s blog, we will precisely talk about what is a BAS, and if you are stumped and don’t know what to include on a BAS, this guide will sort all things out!

What is a Business Activity Statement (BAS)?

A business activity statement is a detailed report to be submitted by an Australian business to the ATO. As per this report, multiple business taxes should be paid to the pertinent tax office. Therefore, BAS consists of accurate details about the major business taxes needed to be paid by a business. Such taxes are:

• Luxury car tax or LCT
• GST or Goods and Services tax
• Fuel tax credits
• Pay as you go or PAYG tax withheld
• PAYG income tax instalment
• Wine equalisation tax or WET
• Fringe benefits tax instalment or FBT

Every Business Activity Statement is unique to a business, and it may or may not incorporate all the aforementioned taxes. The Business Activity statement of your business will solely include a precise report about those tax types, which your business is entitled to pay. 

How to lodge your BAS?

ATO, aka the Australian Taxation Office, will send your activity statement approximately 2 weeks prior to the end of the reporting period. All you have to complete and return by the due date along with the due payment of BAS. You can lodge your BAS:

• By email
• By phone, mainly for void statements only
• Through a BAS agent or a registered tax
• Online via Standard Business Reporting software or Business Portal
• Online via myGov account interlinked to the ATO, only if you are a sole trader

How often do you need to lodge a Business Activity Statement?

The due date will be demonstrated on your form for paper lodgments for lodging and paying your BAS. In case you lodge electronically, you will get diverse BAS due dates. 

On the other hand, if that due date falls on Saturday, Sunday, or even on a public holiday, you will get the next business day to lodge and pay the BAS. 

Your payment cycle and reporting for GST will be one of the following:

• Monthly

Do you have a GST turnover of $20 million or over this amount? If so, you can opt for a monthly payment. 

• Quarterly

Choose quarterly payment if you have a turnover of $20 million or less. 

• Annually 

Pick annual payment mode if you are registering for GST. Also, your turnover in GST is less than $75,000 or for non-profits, the amount would be $150,000. 

Natural calamities could alter the Business Activity Statement due dates and also if any extenuating situations emerge. A BAS agent will diligently help you with ascertaining your filing needs and due dates. 

When is the due date of BAS?

The Australian Taxation Office or ATO possesses stringent BAS lodgements dates. Therefore, it will be worth your time to record those in your calendar and also set unmissable reminders:

In case you don’t know, using a BAS Accountant will give you a full month’s additional time to lodge your BAS and reimburse the GST bill. So, getting in touch with a professional accountant will help you enhance cash flow.  

How to prepare a simple BAS?

BAS is a simple form that recapitulates the GST and other taxes you have held back during the quarter. The minimal piece of information you should report on your BAS form includes:

• That GST amount you owe ATO
• Any alterations to your GST payment, which means if you previously made a mistake on your BAS
• The amount of PAYG tax you have retained from employee salaries
• The entire amount being sent to the ATO
• A small variation to your PAYG tax payment because of a previous return or error

Here’s a precise BAS preparation checklist of the tasks you have to complete before reporting your Business Activity Statement for the quarter, which is shown below:

Check for following in BAS period

• Governments grants
• Overseas imports and customs invoices
• Recruit financial or purchase covenants
• Sale/ purchase / trade-in of vehicle
• Payroll terminations – Tax computation
• Insurance refunds and claims
• Owners or directors loans

Assess all the entered details and accounts reconciled

• Cash expenses are provided
• Credit cards, all banks, and loans are reconciled, including bank and credit card
• Full-fledged data file auditing procedure for your software

Analyse and check tax codes

• Operate and evaluate GST synopsis report
• Clear query tax codes

Conform GST with reports

• In case of cash, conform GST reports with P&L report and income form
• For accrual, conform GST reports with various balance sheet accounts

Prepare BAS

• Run and analyse GST detail report and verify all the tax codes
• Print the report and keep the copy
• Run and assess GST summary report and keep that copy
• All the accounts must be reconciled
• The lock period for ensuring no data alterations are made while preparing BAS
• Prepare Business Activity Statement and verify all the remaining balances similar to reports
• Enter BAS payment

In a nutshell, a Business advisor Perth is a registered agent with the Tax Practitioners Board. Therefore, if you use an unregistered tax agent, you might be entangled in any fraudulent cases. 

Hopefully, this blog provides you with seamless information about BAS, how to lodge your BAS, and so on. So, it’s undoubtedly a simple process, and you shouldn’t have undergone any issues while submitting the correct details on time.