Most business owners are fine with the day to day work. The trouble starts when the BAS is due and the books are behind. A few receipts are missing. Some invoices are only half entered. A bank payment was never coded. By then you are stuck fixing months of small things in one go.
A BAS is not that hard when you prepare a bit at a time. You just need clean records, a few checks and the due date in your diary. This guide covers what a BAS is, what goes on it, and the steps to get it ready before you lodge.
What Is a BAS?
A BAS, or Business Activity Statement, is a form you send to the Australian Taxation Office (ATO). It reports the GST you collected and the GST you paid. It can also cover PAYG withholding and PAYG instalments. The result tells you what you owe the ATO, or what they owe you.
If your business is registered for GST, you have to lodge one. Most small businesses lodge every quarter. Some choose monthly, and a few very small ones can report GST once a year. You pick your reporting cycle when you register, and you can ask the ATO to change it later. Good day to day bookkeeping is what makes the BAS numbers right, because the form only adds up what is already in your records.
What Goes on a BAS?
You don’t fill in every box. It depends on what your business is registered for. These are the labels you will see most often:
- G1 Total sales: your sales for the period, including GST.
- 1A GST on sales: the GST you collected from customers.
- 1B GST on purchases: the GST you paid on business costs, which you can claim back.
- W1 and W2: total wages paid and the tax withheld from them.
- PAYG instalment: a part payment towards your income tax.
- FBT instalment: only if you provide fringe benefits to staff.
The GST sum is simple. Take GST on sales (1A) and subtract GST on purchases (1B). A positive number is what you pay. A negative number is a refund.
BAS Due Dates
Your due dates depend on how often you report. Quarterly BAS is usually due on the 28th of the month after the quarter ends. The October to December quarter is the odd one out. It is due on 28 February.
| Quarter | Period | Standard Due Date |
|---|---|---|
| Q1 | July to September | 28 October |
| Q2 | October to December | 28 February |
| Q3 | January to March | 28 April |
| Q4 | April to June | 28 July |
Monthly BAS is due on the 21st of the next month. If the date lands on a weekend or public holiday, it moves to the next business day. Registered tax and BAS agents can often lodge for their clients on later concession dates, which is usually about two weeks later. Your exact date shows on your BAS and in your ATO online account, so check it there.
One more thing. The lodgement date and the payment date are the same day. Lodging on time but paying late still counts as late.
How to Prepare Your BAS, Step by Step
Step 1: Confirm your reporting period
Check how often you report and which dates apply to you. Put the due date in your calendar. Add a reminder two weeks before it as well.
Step 2: Gather your records
You need sales invoices, supplier bills, bank statements, payroll reports and receipts for anything you plan to claim. If you use cloud software like Xero, most of this is already in one place. If you still use paper, sort it into the right period first.
Step 3: Reconcile your bank accounts
Match every bank transaction to an invoice, bill or expense for the whole period. Unmatched items are one of the most common reasons BAS figures come out wrong. Doing bank reconciliations every week keeps this step short.
Step 4: Check your GST codes
Look at the tax code on each transaction. Some things include GST. Some are GST-free, like fresh food and some health costs. Others are input taxed or have no GST at all, such as wages and life insurance. A wrong code means a wrong claim.
Step 5: Review payroll and PAYG withholding
If you have staff, check that wages and tax withheld match your payroll reports. These should also line up with what you sent through Single Touch Payroll. If the numbers don’t match, find out why before you lodge.
Step 6: Run your GST report
Export the GST report from your software. Check the totals for sales, purchases, GST collected and GST paid. Look for anything odd, like a very large claim or a sudden drop in sales.
Step 7: Lodge and pay
You can lodge through ATO online services for business, through your accounting software, or through a registered agent. Pay by the due date. Keep a copy of the lodged BAS and your working papers. The ATO can ask for them later, and business records need to be kept for five years.
Cash or Accrual: Which GST Method Applies?
You can report GST on a cash basis or an accruals basis. On a cash basis, you count GST when money actually moves. You report GST on a sale when the customer pays you. You claim GST on a purchase when you pay the supplier. Many small businesses prefer it because they only deal with what has really come in or gone out.
On an accruals basis, you count GST when the invoice is issued or received, even if no one has paid yet. That means you can owe GST on a sale before the money lands in your account. Turnover limits apply to the cash method, so check you are eligible. Whichever you use, stay consistent and make sure your software settings match.
Common BAS Mistakes
Most BAS errors are small. These come up a lot:
- Claiming GST without a valid tax invoice.
- Claiming GST on private expenses.
- Using the wrong GST code.
- Leaving out cash sales or sales made outside the main system.
- Not matching PAYG figures to payroll reports.
- Lodging late because one receipt was missing.
- Lodging before the bank accounts are reconciled.
If you find a mistake after lodging, deal with it early. Small errors can often be fixed on your next BAS. Bigger ones may need a revision. Waiting for the ATO to notice first is the worse option.
What Happens If You Lodge or Pay Late?
The ATO can charge a failure to lodge penalty. It is worked out for each 28-day period the BAS is overdue, and the amount depends on the size of your business. You can also be charged general interest charge (GIC) on anything unpaid. The interest builds daily and starts the day after the due date.
If you can’t pay in full, lodge on time anyway and contact the ATO early. They can often set up a payment plan. Penalty amounts change, so check ato.gov.au for current figures. Late super is a separate issue with its own rules, and Payday Super has changed the timing for employers.
Habits That Make BAS Easier
You don’t need a fancy system. A few routines are enough:
- Reconcile your accounts weekly or fortnightly.
- Upload receipts as you get them.
- Keep business and personal money in separate accounts.
- Move the GST from each payment into a separate savings account.
- Check your reports a few weeks before the due date, not the night before.
The GST savings account is the one that helps most. When the bill comes, the cash is already there. If you are starting from scratch, a proper bookkeeping setup makes all of these routines easier.
Keep the Books Tidy and the BAS Takes Care of Itself
Most BAS headaches begin weeks before the due date. A receipt gets lost. A transaction sits unmatched. By lodgement day, small gaps have turned into a big job. A few minutes each week keeps that from happening.
If your books are behind or you aren’t sure about GST codes, you can talk to our team at Elite Plus Bookkeeping. We look after bookkeeping, bank reconciliations and payroll records for small businesses, so your figures are ready when your BAS is due. You can book a free consultation or call us on 1300 744 733.
Frequently Asked Questions
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