Preparing a business activity statement (BAS) involves reviewing your business transactions, calculating goods and services tax (GST), reporting applicable pay as you go (PAYG) amounts, and lodging the completed statement with the Australian Taxation Office (ATO).
A BAS can include several tax obligations, depending on your business registrations. Following these steps will help you report the correct amounts, avoid common errors, and meet your lodgement deadline.
Step 1: Gather Your Business Financial Records
Start by collecting the financial records covering your BAS reporting period. Your transactions should be recorded and reconciled before you calculate any amounts.
The main records you may need include:
- Sales invoices and receipts
- Supplier invoices and business expense receipts
- Business bank and credit card statements
- Payroll reports and PAYG withholding records
- Previous BAS statements, where relevant
If you use accounting software such as Xero, MYOB or QuickBooks, check that transactions have been entered and classified correctly.
Accurate business bookkeeping makes this process easier by keeping your records organised throughout the reporting period.
Step 2: Calculate the GST on Sales and Purchases
Next, determine how much GST your business collected on taxable sales and how much it can claim as GST credits on eligible purchases.
Most Australian businesses using the Simpler BAS method report three GST figures:
| BAS Label | What to Report |
|---|---|
| G1 | Total sales |
| 1A | GST payable on taxable sales |
| 1B | GST credits on eligible business purchases |
For example, if your business collected $8,000 in GST and has $3,000 in eligible GST credits, the net GST payable would be $5,000.
Check that GST-free sales, input-taxed supplies and purchases without GST credits have been treated correctly. Also, apply your registered GST accounting basis, either cash or non-cash (accrual), when determining which transactions belong in the reporting period.
Businesses required to use full GST reporting must complete additional BAS labels.
Step 3: Include PAYG and Other Tax Obligations
Your BAS may require information beyond GST.
Depending on your business, you may need to report:
- PAYG withholding: Tax withheld from employee wages and certain other payments.
- PAYG instalments: Payments towards your business’s expected income tax liability.
- Other applicable taxes: Fringe benefits tax instalments, fuel tax credits or industry-specific tax obligations.
Use your payroll reports and ATO instalment information to complete the relevant fields. Only fill in the sections that apply to your business.
Step 4: Review Your BAS Before Lodging
Before submitting the statement, compare the reported figures with your accounting records.
Check that:
- Sales and expense totals match your reconciled records.
- GST has been applied to the correct transactions.
- Eligible GST credits are supported by the required documentation.
- PAYG withholding agrees with your payroll records.
- Adjustments and corrections have been recorded correctly.
Pay particular attention to duplicate transactions, incorrectly classified expenses and omitted invoices. These can affect the final amount payable or refundable.
Step 5: Lodge Your BAS With the ATO
Once you have checked the figures, lodge your BAS through an approved method, including:
- ATO Online services for business: Sign in and submit your BAS electronically.
- Accounting software: Lodge using software that supports ATO BAS lodgement.
- Registered tax or BAS agent: Have an authorised professional prepare and lodge the statement on your behalf.
The standard quarterly BAS due dates are:
| Reporting Period | Standard Due Date |
|---|---|
| July–September | 28 October |
| October–December | 28 February |
| January–March | 28 April |
| April–June | 28 July |
Monthly BAS statements are generally due on the 21st of the following month. Different deadlines or extensions may apply, including when lodging through a registered agent. Always check the due date shown on your BAS.
Step 6: Pay Your BAS and Keep Your Records
After lodging, check the amount payable and arrange payment by the applicable deadline.
Keep copies of your lodged BAS, supporting tax invoices, calculations and payment confirmations. Generally, relevant GST records must be retained for at least five years, although other record-keeping obligations may require longer periods.
If you identify an error after lodgement, the ATO allows certain mistakes to be corrected on a subsequent BAS. Other errors may require revising the original statement.
Get Assistance With BAS Preparation and Lodgement
Preparing a BAS becomes more manageable when your bookkeeping, payroll and GST records are accurate throughout the year.
Mizael Partners provides business accounting services across Australia, including BAS preparation, GST reporting and PAYG compliance. We can review your business records, confirm the applicable reporting requirements and prepare your BAS for lodgement.
Contact Mizael Partners or call 1300 444 004 to discuss your BAS requirements.
FAQs
Can I prepare and lodge my own BAS?
Yes. Business owners can prepare and lodge their own BAS through ATO Online services for business or compatible accounting software. If your business has complicated GST transactions, payroll obligations or reporting adjustments, a registered tax or BAS agent can help you prepare and lodge the statement accurately.
What happens if I lodge my BAS late?
Lodging your BAS after the due date may result in an ATO failure-to-lodge penalty. If you also have an overdue payment, interest charges may apply. Contact the ATO as soon as possible if you cannot meet your lodgement or payment deadline.
Do I need to lodge a BAS if my business had no sales?
Yes. If the ATO requires your business to lodge a BAS for a reporting period, you generally must submit it even if you made no sales. If you have no amounts to report against any applicable BAS labels, you can lodge a nil BAS.
Can I correct a mistake on a previously lodged BAS?
Yes. Certain GST errors can be corrected on a subsequent BAS if they meet the ATO’s correction rules. Other errors may require you to revise the original statement. The correct approach depends on the type of error, its value and the applicable time limits.
What is the difference between a BAS and an income tax return?
A BAS reports GST, PAYG withholding, PAYG instalments and other applicable tax obligations, generally monthly or quarterly. An income tax return reports your business’s taxable income and determines its annual income tax liability. Depending on your business structure and registrations, you may need to lodge both.