Do you own a business registered to pay Goods and Services Tax (GST)? If so, then you must lodge a Business Activity Statement or BAS. But first things first, what is a Business Activity Statement (BAS)? The mere mention of it is enough to make some business owners drop everything they are doing just to get to it.
Are all business owners required to lodge a BAS? How can a tax agent in Sydney help in lodging it? What are the processes involved during lodgement?
In this guide, we’ll go over the details of preparing a Business Activity Statement. Continue reading.
Business Activity Statement (BAS): What Is It and How Does It Work?
Running a business often means learning a lot of acronyms like BAS. A Business Activity Statement (BAS) is a document that is issued monthly or quarterly. This document is prepared so business owners can report on Goods and Services Tax (GST), Pay As You Go (PAYG) instalments, PAYG withholding tax, and any other tax obligations.
A BAS is broken up into sections called labels. Depending on how you choose to report and pay, you need to fill out different labels.
Does everyone need to lodge and pay a BAS?
Only those that have registered for the Goods and Services Tax (GST) are required to lodge a BAS. Registration for Goods and Services Tax (GST) is required when a business’ gross income is equal to $75,000 or more (excluding GST of 10%). You might find it unnecessary to register for GST in the early stage of your business.
Just bear in mind that once you start earning the big bucks, then lodging a BAS becomes a legal requirement. After registering for an Australian Business Number (ABN) and Goods and Services (Tax), the Australian Taxation Office (ATO) will let all business owners know when their BAS is due to be lodged. So, expect to receive a form from the ATO once your business starts earning $75,000.
When is the deadline for lodging and paying a BAS?
As a business owner, you can run your business smoothly if you lodge and pay your BAS on time. You can find the due date for lodging and paying your BAS on the form sent by the Australian Taxation Office (ATO). If you are with a registered BAS or tax agent, you can have access to extended due dates.
You can lodge and pay on the next business day if the due date displayed on your BAS form is on a weekend or public holiday. How often you complete and submit a BAS depends on how much business you’re doing (as measured by your annual turnover).
More than $20 million annual turnover
For big businesses with more than $20 million annual turnovers, it is imperative to lodge a BAS monthly. The lodging and submission should be within 21 days of the month closing.
Less than $20 million annual turnover
For businesses with less than $20 million annual turnovers, lodging a BAS should be done quarterly. The lodging and submission should be within 21 days of the month closing. For the first quarter (July-September), the BAS is due on 28 October. For the second quarter (October-December), the due date is on 28 February. For the third quarter (January-March), the BAS is due on 28 April. Finally, for the fourth quarter (April-June), the due date is on 28 July.
You may be able to lodge annually if your turnover is less than $10 million. You are still required to pay a quarterly instalment of the Goods and Services Tax (GST) you owe.
Less than $150,000 for non-profits or $75,000 annual turnover
For businesses with less than $75,000 annual turnovers, a BAS should be lodged annually. It must be submitted with an income tax return.
How does one lodge a BAS?
Below are your lodgement options:
1. Online
Businesses can lodge their BAS online. This is the quickest, easiest, and most secure route. You can lodge at a time that’s convenient to you and get help to avoid mistakes.
This option lets you review your BAS before lodging and check that the amount calculated is equal to the amount you expect to pay or receive. With this option, you may receive an additional two weeks to lodge and pay your BAS.
2. Tax Agent
Business owners work with a registered BAS or tax agent in Sydney to help them lodge their BAS. Tax agents can pay on your behalf. They have access to view your BAS and reminder messages sent to you through their online service.
When you have an agent, you can still access your BAS even if they are managing it on your behalf.
3. Mail
The conventional way of lodging a BAS is via mail. This is not an option if you’re lodging your BAS through an online channel. You can mail your BAS using the pre-addressed envelope provided in your BAS package sent by the ATO. If you haven’t received one, you can ask the ATO for a copy.
Did you make a mistake in your BAS? We’re here to help!
So, you completed your BAS and discovered that you have left something out of a previous BAS or made a mistake. This can be remedied by lodging a revised BAS. However, take note that correcting a mistake on your current BAS is different from making an adjustment. You may need the assistance of a tax agent in Sydney to lodge your BAS.
If you’re looking for a tax accountant in Mascot NSW, we at Practical Accountants Australia are here to help. For over two decades, we have been managing the financial affairs of individuals and small- to medium-sized business. Work with us to lodge your BAS accurately.
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