In the intricate process of Australian business finances, understanding the Business Activity Statement(BAS) and other related factors can be crucial for your business health. In this carefully roadmapped guide, we will take you through the process of BAS reporting, its payment cycle, and due dates.
What is BAS?
BAS refers to the Business Activity Statement. Any business registered for GST needs to lodge a BAS report. This report encapsulates the business financials including the details about sales, purchases, and other taxable activities. It also reports on your GST (Goods and Service Tax), PAYG (Pay as you go) installments, and withholding tax as well as Taxes such as FBT (Fringe Benefits Tax).
Once you register your business for GST and ABN, you will automatically receive a BAS lodging intimation by ATO when it’s time to file. This report helps ATO know how much tax you have to pay or the amount that needs to be refunded to you.
A lot many business owners have doubts about how to lodge BAS and if it is the same as paying the BAS. Well, to answer that, lodging is different from paying. It is suggested to lodge a BAS even if you do not have the funds to pay for it currently as it gives you two weeks of time to make the payment.
You can lodge BAS through the online portal, by email, or with the help of a registered agent. The deadlines for lodging and paying BAS are mentioned in the report. So, make sure you are not running behind the time as it may cost you hefty penalties. Based on the mode, the deadlines can change too.
ATO accepts debit cards, credit cards, and BPAY for BAS payments. So, you can choose the one you find convenient.
BAS Payment Cycles and Due Dates
The BAS payment and reporting cycle is based on the GST turnover and will be mentioned on your paper lodgements. There are three cycles for a business to follow:
- Monthly: For businesses having GST of $20 million and more (or the ones who voluntarily choose to go with a monthly cycle)
- Quarterly: For businesses having a GST of less than $20 million
- Annually: For businesses having a GST of less than $75,000 (or $150,000 for Non-profits)
Monthly Due Dates
For businesses adhering to a monthly reporting cycle, the deadline looms on the 21st day of the subsequent month. Timely compliance is imperative, ensuring a seamless financial trajectory.
Quarterly Due Dates
For those navigating quarterly reporting cycles, the deadline extends to the 28th day of the month following the quarter’s closure. Strategic planning is pivotal to maintaining financial equilibrium.
Annual Due Date
For a select few operating on an annual reporting frequency, the conclusive date is the 28th day of the second month following the fiscal year’s culmination. It demands meticulous preparation and precision.
Common Mistakes while Preparing BAS Report
In the process of preparing BAS, there are certain errors that can turn into pitfalls, and so, must be avoided. These include:
- Not claiming all the GST credits
- Missing to pay GST on a cash basis
- Incorrectly adding GST on GST-free items
This can cause miscalculations, inaccuracies in GST treatment, and oversight of eligible credits. Therefore, it is suggested to double-check your entries and reports for flawless compliance.
Tips to Lodge BAS
Don’t worry, we have got you covered for near-perfect reporting. Just follow the tips mentioned below:
- Maintain impeccable financial records – each transaction is consequential.
- Leverage advanced accounting software for heightened accuracy.
- Establish a consistent financial rhythm through regular reconciliation.
- Seek professional guidance for navigating intricate financial scenarios.
In the landscape of financial management, mastering the nuances of the BAS process is foundational for seamless compliance. By comprehending due dates, sidestepping common pitfalls, and embracing strategic tips, your business can navigate the financial landscape with poise and adherence. Maintain financial acumen and compliance – the cornerstones of enduring success
Also, to learn about Single Touch Payroll, and its penalty or deadline, go through Single Touch Payroll: Mandatory Compliances for Australian Employers.
Written by – Priyanka Rampal
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