Understanding your BAS Statement: A Must Have Guide for Sutherland Shire Business Owners

Googling ‘What is a BAS Statement’ is basically a part of the business owner initiation! There’s no denying that  the Business Activity Statement (BAS) is a complex yet  critical part of business management in Australia. 

This comprehensive guide will help you understand what BAS is, why BAS is important, its requirements, and how to effectively prepare and submit it, so you’re compliant with the Australian Taxation Office (ATO) regulations.

Business activity statement definition:

A Business Activity Statement (BAS) is a mandatory report submitted by businesses to the Australian Taxation Office (ATO) to declare and settle their tax obligations. This statement predominantly focuses on the Goods and Services Tax (GST).

Additionally, the BAS may encompass other tax elements like PAYG withholdings and instalments, wine equalisation tax, fuel tax credits, and fringe benefits tax, depending on their relevance to the specific business.

Who needs to pay BAS?

Businesses Registered for GST: Any business that is registered for the Goods and Services Tax (GST) must submit a BAS. This typically includes businesses with an annual turnover of $75,000 or more ($150,000 or more for non-profit organisations).

Employers: Businesses that have employees and withhold taxes from their wages must report these amounts through the BAS under the Pay As You Go (PAYG) withholding system.

Businesses Paying Instalments: Those who make payments towards their expected annual income tax liability (PAYG instalments) are also required to submit a BAS.

Businesses Incurring Other Specific Taxes: If a business deals in areas that incur taxes like the wine equalisation tax, fuel tax credits, or fringe benefits tax, they will report and pay these through the BAS.

It’s important for businesses to understand their obligations regarding the BAS, as it is a key component of tax compliance in Australia. 

When do I lodge BAS?

The frequency of submission (monthly, quarterly, or annually) can vary depending on the business’s size and other factors

Why is the BAS Statement Important?

BAS ensures compliance with tax laws and plays a vital role in the financial management of your business. Timely and accurate BAS submission can prevent legal issues and penalties while helping you maintain a healthy cash flow.

Tally Up Tip – instead of waiting for the BAS bill to hit, use your previous statements as a guide and allocate a percentage from each invoice into a ‘tax account’.

BAS statement dates 2024:

Depending on your business size and structure, BAS can be submitted monthly, quarterly, or annually. The deadlines are as follows:

For more detailed information, visit the ATO website.

What information do you need for your BAS?

Start by collecting all necessary financial data. This includes total sales, GST collected on sales (GST on income), GST paid on purchases (GST on expenses), PAYG income tax instalment, and PAYG tax withheld. Having all invoices, receipts, and financial statements up-to-date and accessible is crucial for accurate reporting.

Organising Your Financial Records for the BAS Statement

Good organisation is key. If you don’t have a bookkeeper, using your accounting software to categorise and store financial transactions as you go  is highly recommended. Regular and systematic record-keeping eases the work that goes into the BAS preparation process, so  relevant data is easily to get when needed. It also prevents mistakes down the track.

Calculating GST Amounts for the BAS Statement

The core of the BAS is calculating your GST obligations. This involves declaring the amount of GST you’ve collected from sales and subtracting the GST you’ve paid on your purchases. When these figures aren’t correct, is when you can run into trouble because accurate calculations are used to determine your net GST position – whether you owe GST to the ATO or are eligible for a refund.

Completing the BAS Statement Form

The good news is, if you invest in a bookkeeper, they lodge your BAS form for you!

If you’re DIY-ing, make sure you set aside some time where you can fill out your BAS form uninterrupted because it requires attention to detail. The ATO website provides comprehensive instructions on how to complete the BAS form, which can guide you through each section. Fill in all the required fields accurately, including total sales, GST on income, and GST on expenses.

Submitting Your BAS Statement Online

Sample BAS statement, credit: ATO

The most efficient method of submitting your BAS is online through the ATO’s Business Portal. For this, you need a myGovID. Online submission is not only quick but also secure, and you receive immediate confirmation from the ATO. 

If you lodge quarterly, be sure to check if you’re eligible for the two week extension. YOu can see the details here: https://www.ato.gov.au/online-services/in-detail/two-week-lodgment-concession-terms-and-conditions

Common Mistakes to Avoid When Preparing and Submitting Your BAS Statement

Definitely leaving it until the last minute. Some other common mistakes include incorrect GST calculations, missing deadlines, and failure to report all taxable transactions. To avoid these, double-check everything before you hit submit, and if you choose to DIY try to keep your records up to date and accurate.  Setting a time to do your bookkeeping each week and consistently reviewing your financial data can help in identifying and rectifying errors before submission.

What are the advantages of outsourcing your BAs to Tally Up’s bookkeepers and Bas agents in the Sutherland shire? 

Business owners who outsource their BAS experience a number of benefits. While we’re great at handling BAS for businesses in the Sutherland Shire, we recommend full service bookkeeping for our clients. Here’s why choosing our full-service bookkeeping is a smart move:

Everything in One Place: 

Instead of just sorting out your BAS, we handle all your numbers. This means we look after your bills, track what you’re earning and spending, and make sure everything adds up. It’s like having a one-stop-shop.

Tailored to Your Business:

Your business is unique, and we get that. We don’t just do a one-size-fits-all kind of service. We pay attention to what your business needs and customise our services and the way we communicate with you to fit that perfectly.

We’re Part of Your Team:

Think of us as an extension of your business. We’re here to give you advice and help make decisions that are good for your business’s future. We’re in this together!

Consistent and Reliable:

Having one person handle all your bookkeeping means everything is consistent. You won’t have to worry about different people messing with your numbers. We keep things smooth and steady.

Save Time and Stress:

By handing over the bookkeeping stuff, you free up a lot of your time. Time you can spend growing your business or just taking a well-deserved break. Plus, no more headaches from trying to figure out all those numbers!

While we’re happy to help with your BAS, we’re at our best when we take care of all your bookkeeping needs. It’s simpler for you, and it lets us do what we do best – helping your business stay on top of its game financially. Think of it as a smart investment for your business’s future.

Conclusion: Simplifying the BAS Statement Process

The BAS process, while complex, is a requirement of the ATO and keeping on top of it is crucial for your business’s financial health and compliance. Managing your BAS involves understanding its components, staying organised, using technology to your advantage, and seeking professional advice when needed. 

As part of our done for you bookkeeping services in the Sutherland Shire, we can manage the BAS process for you. 

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Ready to take your books and business to smooth operator level? Smart choice!

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Ready to take your books and business to smooth operator level? Smart choice!