Do you own a small business in Australia? Then you should check whether it is eligible for GST registration or not. If your business turnover is more significant than a threshold value, you have to register for GST. There are also other conditions like vehicle charges and non-profit earnings which you need to fulfil for gaining eligibility for GST registration. Now, once you register for GST, you have to submit a business activity statement, which includes expenses over a particular financial period. BAS is done for the necessary tax return. But do you know what are the requirements to lodge BAS? Here in this article, we have explained the BAS and the requirements to lodge BAS for a small business in Australia.
What is a Business Activity Statement?
A Business Activity Statement or BAS is nothing but a government form you need to submit to the Australian Taxation Office. You will have the option to choose the submission period which will depend on your business size. A majority of small businesses submit it quarterly. And so, you have to fill the form four times a year for a quarter submission. The information you can include in BAS is reporting on GST, Pay As You Go (PAYG) Instalments and several other tax obligations.
Remember that if your business has a GST registration, then only you will require lodging a BAS. There is no need for registering for GST once you start your business, as you cannot know how much you will earn annually at that early period. But, once you start making high profits, you must get registration. Before submitting BAS, you must get your (Australian Business Number) or ABN. Australian Taxation Office will provide you with a notification about BAS submission timely. So, you mustn’t worry about that.
How can you prepare BAS?
You can opt for excel spreadsheets where manual filling of information is possible. But, as an owner, you need to look after a hell of a lot of things. So, why will you spend ample time preparing the BAS while there are several online tools available in the market? Here are some of the advantages you will get from using this software.
-
Effortless Report
Digital software will reduce physical labour and exhaustion. So, you can prepare reports on profit and loss and balance sheets quite easily.
-
Arrangement of Helpful Information
You will be able to arrange the most necessary information required to lodge your BAS.
-
Preparation of financial reports
And most importantly, financial statements can also be prepared without much difficulty.
But, there are drawbacks of these software tools also. You may have to face unnecessary problems in case you fail to perform the necessary research on the utility and the potential benefits of the software. You can read client reviews for that. Besides online accounting software, you can lodge BAS with the help of ATO’s online business portal or a registered BAS agent. If you are a sole trader, then you can use your myGov account.
Factors To Consider While Lodging Bas Tax Return?
Following are the factors which to note while preparing the BAS tax return. You can consult with your BAS accountant regarding this.
-
Bank transaction allocation
Bank transactions have to be implemented for various tasks in a business-like purchase, sales, payments, debt clearing. Whether these transactions are being made to the correct bank accounts have to be checked carefully.
-
Verification of bank balance
A mismatch in the bank balance information can have grave consequences. Always verify that the amount mentioned in the accounting software matches the one present in your actual bank account.
-
Including tax receipts and invoices
Tax invoices and receipts are crucial for the fact that these provide enough evidence of your clarity in business. You must keep them carefully for the records.
-
GST tax code preparation
It is important to verify and check GST tax codes for all the transactions you have made.
-
Checking the accuracy of the GST tax code
Does your business involve foreign transactions? For any overseas purchase or insurance, it must be checked whether the tax code is written accurately as inaccuracy might result in misinformation that may cause a delay in the whole process and subsequent loss in the business.
-
Storing paperwork of purchases
It is recommended to keep the papers and documents of purchasing a new asset or a financial arrangement.
-
Other tax inclusions
Other taxes like fuel taxes, fringe benefit taxes, or PAYG withholding have to be there in the statement, not just GST or PAYG instalments.
The reason for which checking of BAS at every level is required is that it will increase the accuracy. It will also suppress the chance of a rise in GST or PAYG instalments at the end of a financial year. As you will have a crystal clear idea about the liabilities, you will maintain a steady cash flow.
Read More: How A Financial Advisor Can Help You To Invest And Save Money For Your Retirement
What Are The Due Dates For Your Bas Lodgement?
As told before, as a small business owner, you have to lodge BAS quarterly. Whether you are in Perth or any other place in Australia, this would be the rule. There are four quarters, and in each of them, the due dates are as follows:
- Quarter – 1st April to 30th June: The due date in this quarter will be 28th July for you while that for your Tax agent in Perth will be 25th August.
- Quarter – 1st January to 30th March: Wish to lodge your BAS within this quarter? The due date will be 28th April for you. If you hire a BAS agent, the date would be 26th May.
- Quarter – 1st October to 31st December: This is the only quarter where the due dates will be the same for both you and your agent. That will be 28th February of the following year.
- Quarter – 1st July to 30th September: For this quarter, the due date for you will be 28th October while that for your agent will be 25th November.
Ending note
For necessary information and details about the requirements to lodge BAS, you can always get in touch with us at Accountant Perth, which can provide you with professional advisors for proper guidance.
