If your business is operating in Australia, you’re responsible for submitting Business Activity Statements (BAS) to the ATO – even if you did no business during the reporting period! These statements are used to report on and pay several different types of taxes including the Goods and Services Tax (GST) you’ve collected, Pay as You Go (PAYG) instalments or withholding, Fuel Tax Credits (FTC) and Fringe Benefits Tax (FBT). Alternatively, if you’re paying a quarterly PAYG instalment, you’ll also need to submit a BAS.
Submitting your BAS
Submitting the BAS is how your tax liability is assessed, but exactly what type of tax you’re required to pay depends on a number of different variables other than just the monetary size of your company. Number of employees, as well as the benefits you provide, the type of goods you buy or sell, and the registered location of your business are all factors that affect how much and what kind of tax you’ll need to pay.
If your business makes more than $20 million a year, you must file a BAS for GST once a month, but if you’re not quite that big (yet!) you only need to file quarterly or even annually. PAYG and FBT instalments are submitted quarterly. PAYG withholding is submitted quarterly with these considerations – if your annual obligation is less than $25,000; and if your monthly obligation is more than $25,000, but not less than $1 million.
What to Include
Make sure to include the reporting period, the Document ID, your Australian Business Number (ABN) and your signature on the BAS form. If you ever need to contact the ATO, you’ll need the Document ID and your ABN to identify your business.
As we mentioned earlier, even if you don’t do any business over the reporting period for your BAS, you’re still required to file. Your statement for that period will be referred to by the ATO as a nil report.
How to Lodge
Fortunately, the ATO makes it easy for businesses to comply with their requirements by providing several different methods for lodgement. They have an online business portal, as well as a BAS portal, although this is reserved for BAS Agents, tax agents, and large businesses.
If you’re using cloud based accounting platforms like Xero the software will walk you through the steps you need to lodge this important tax document.
The ATO has made the BAS process of lodging and paying as painless as possible, but using an accounting system to generate the information automatically will make it even easier—no matter how many times a year you have to file!