BAS Statements in Australia: Best Practices for Small Business Owners

Running a business in Australia comes with many responsibilities, and one of the most important is staying on top of your tax obligations. For most businesses, this means regularly lodging a Business Activity Statement (BAS) with the Australian Taxation Office (ATO). While BAS can feel complicated, having the right systems and practices in place can make the process much easier.

What is a BAS Statement?

A BAS is a form submitted to the ATO that reports your business tax obligations. These usually include:

• Goods and Services Tax (GST)

• Pay As You Go (PAYG) withholding tax for employees

• PAYG instalments

• Other taxes your business may be registered for

BAS helps the government keep track of the taxes your business owes and ensures that you stay compliant. Depending on the size of your business, you may be required to lodge monthly, quarterly, or annually.

Why BAS Matters

Failing to lodge your BAS on time can lead to penalties, interest charges, and cash flow problems for your business. More importantly, accurate BAS reporting helps you keep a clear picture of your financial health and avoid surprises at tax time.

Best Practices for Managing BAS

1. Stay Organised from Day One

The best way to reduce BAS stress is to keep your records up to date throughout the year. This means having systems in place for tracking:

• Income and sales

• GST collected and GST paid

• Employee wages and PAYG withholding

• Business expenses and invoices

Using cloud-based accounting software such as Xero, MYOB, or QuickBooks can simplify this process by automatically recording transactions and generating BAS reports.

2. Reconcile Regularly

Do not wait until the BAS deadline to catch up on your bookkeeping. Reconciling your bank accounts and reviewing your financial records regularly ensures your BAS is accurate and saves you from last-minute scrambling. Setting aside time each week or fortnight to update your accounts is one of the simplest but most effective habits to adopt.

3. Understand What You Can Claim

If your business is registered for GST, you can generally claim credits for the GST you pay on business purchases. Make sure you keep receipts and tax invoices for all expenses you plan to claim. Misunderstanding GST credits is one of the most common areas where businesses make mistakes, so it pays to check the rules carefully or work with a registered BAS agent.

4. Set Aside Money for BAS Payments

One of the biggest challenges for small business owners is cash flow management. BAS payments can be large and difficult to cover if you have not prepared. A smart practice is to set aside a percentage of every payment you receive into a separate account. That way, when BAS is due, you already have the funds available.

5. Use a BAS or Tax Agent if Needed

While many businesses handle their BAS themselves, others choose to use a registered BAS or tax agent. An agent can:

• Ensure accuracy in your BAS lodgements

• Identify deductions or GST credits you may have missed

• Manage lodgement deadlines and extensions

• Provide peace of mind that everything is compliant

If your business finances are complex, this can be a worthwhile investment.

6. Know Your Lodgement Dates

Most small businesses lodge BAS quarterly. The standard quarterly deadlines are:

• July to September: due 28 October

• October to December: due 28 February

• January to March: due 28 April

• April to June: due 28 July

If you lodge monthly, the due date is usually the 21st of the following month. Mark these dates in your calendar or set reminders so you are never caught off guard.

7. Review Before Submitting

Before you lodge your BAS, double check your figures. Make sure your sales, expenses, GST collected, and GST paid are all correct. Small errors can lead to big issues, especially if they accumulate over time. A quick review before submission is a simple step that can save a lot of trouble later.

8. Keep Good Records

The ATO requires you to keep records of your business transactions for at least five years. These can be digital or paper-based, but they must be accurate and accessible if the ATO requests them. This includes tax invoices, receipts, bank statements, and payroll records.

Final Thoughts

Managing BAS statements is a crucial part of running a business in Australia. By staying organised, reconciling regularly, and preparing for payments ahead of time, you can reduce stress and avoid penalties. Whether you handle BAS yourself or use a registered agent, adopting best practices ensures that your business remains compliant and financially healthy.

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