Understanding BAS Lodgement for Small Business

A BAS is just a regular report to the ATO of the GST and other tax amounts your business has collected and owes. If you're registered for GST, you lodge one. Get into a routine and it stops being scary. Here's the plain-English version.

TL;DR

You lodge a Business Activity Statement if you're registered for GST, which is compulsory once your GST turnover hits $75,000 ($150,000 for non-profits). Most small businesses lodge quarterly, due the 28th day after each quarter ends, with one exception: the October to December quarter is due 28 February. Keep clean records through the quarter and it's manageable.

What is a BAS?

A Business Activity Statement is a form you lodge with the ATO that reports several tax obligations at once. The main one is GST, but it can also cover PAYG instalments, PAYG withholding from employee wages, and other items depending on your business. The ATO works out which apply to you and pre-fills the relevant sections, so you only complete what's relevant. Register for GST and lodging a BAS becomes mandatory.

Who needs to lodge, and how often?

You must register for GST once your GST turnover reaches $75,000 or more ($150,000 for non-profits). Taxi, rideshare, and limousine drivers must register regardless of turnover, from the first dollar. Below the threshold it's optional. The GST trigger sits inside the same compliance journey as registering your ABN and for GST in the first place.

How often you lodge:

• Quarterly. The most common cycle for small businesses, and the default for those under the threshold who've voluntarily registered.
• Monthly. Mandatory once your GST turnover reaches $20 million or more. Smaller businesses can choose monthly too.
• Annual. May be available if you're voluntarily registered and under the threshold.

Quarterly due dates. Your quarterly BAS is generally due the 28th day after the quarter ends. So Q1 (Jul to Sep) is due 28 October, Q3 (Jan to Mar) is due 28 April, and Q4 (Apr to Jun) is due 28 July. The exception is Q2 (Oct to Dec), which gets extra time over the Christmas period and is due 28 February. Lodging online or through a registered agent can give you more time again. Always confirm your own dates through ATO online services, since they shift around public holidays.

What goes on the BAS?

GST

You report the GST you collected on sales and the GST you paid on purchases, then remit the difference to the ATO. If you paid more GST than you collected, common when you've made big purchases or sell GST-free items, you may get a refund. That's the basic mechanics of GST.

PAYG withholding

If you have employees, you withhold tax from their wages and send it to the ATO. The total you withheld during the period goes on the BAS, separate from your own income tax.

PAYG instalments

These are pre-payments toward your expected annual income tax, spread through the year so you don't cop one big bill. The ATO usually works out the amount from your last return, and you can vary it if your circumstances change.

How to prepare and lodge

A clean BAS starts with clean records. The single biggest favour you can do yourself is keep your bookkeeping current through the quarter, not scramble at the deadline.

1. Keep detailed records of all sales and purchases, with tax invoices where required.
2. Reconcile your accounting software or spreadsheets against your bank statements regularly.
3. Categorise GST-free and input-taxed items correctly.
4. Use accounting software that automates the GST calculations to cut down on errors.
5. Lodge online through ATO online services, your accounting software, or a registered agent.
6. Pay by the deadline. If you can't, contact the ATO early. Payment arrangements usually exist.

Cash vs accruals

You can generally choose your accounting method:

• Cash basis. You report GST when the money actually changes hands.
• Accruals basis. You report GST when the invoice is issued or received, whether or not it's been paid.

Smaller businesses often prefer cash, because it lines up with their real cash flow. You're not paying GST on an invoice your customer hasn't paid yet. Pick one deliberately and stay consistent, because it changes the figures you report.

Common mistakes to avoid

• Claiming GST credits on purchases that had no GST (fresh food) or on personal expenses.
• Forgetting GST-free sales (exports, health, education, some food).
• Leaving it to the last minute and rushing the numbers.
• Not keeping the tax invoices that support your GST credit claims.
• Missing deadlines, which triggers failure-to-lodge penalties and interest.
• Mixing business and personal transactions in one account, which makes reconciliation a nightmare.

If you fall behind

Ignoring an overdue BAS only makes it worse. The ATO is generally far more accommodating with businesses that engage early. If you can't lodge or pay on time, contact them or your registered agent before the due date to talk about a payment plan or deferral. Penalties and interest are often reduced or remitted when you've got a good compliance history and a genuine reason.

What this means for you

A BAS is a routine report, not a crisis. Keep your records organised through the quarter, know which obligations apply to you, hit your deadlines, and lean on a registered BAS or tax agent if you'd rather not do it yourself. Treated as routine, it's entirely manageable.

Next step

If the bookkeeping isn't your thing, don't be afraid to use a registered BAS or tax agent. You can find a registered BAS or tax agent near you in the directory. And if you run an accounting or bookkeeping business yourself, list your accounting or bookkeeping business so local clients can find you.

Sources

• Business activity statements (BAS) — ATO
• Registering for GST — ATO
• Monthly GST reporting — ATO
• Annual GST reporting — ATO
• Due dates for lodging and paying your BAS — ATO
• How GST works — ATO
• Choosing an accounting method — ATO
• PAYG withholding on your BAS — ATO
• Failure to lodge on time penalty — ATO

General information only, not tax advice. Check your own situation with the ATO or a registered agent.