BAS Explained For Small Businesses

So, you have decided to start a new business. Congratulations! Starting your own business can be rewarding and a great move for many people. It may come with some stresses, but with the right tools and knowledge you will be able to overcome it and make your business successful.
One thing all new business owners will need to get to know are Business Activity Statements, also known as BAS.

First, a bit about GST 

To understand what a BAS is and why you need to lodge one, we first need to talk about GST. 
GST, or goods and services tax, is a 10% tax on almost all goods and services sold in Australia. Some sales are exempt from GST, these are generally items like staple foods. However, most businesses will find that their products are not GST-free.
The 10% tax is added to the sale price of your products or services. While you can charge this extra 10% on your products and services right away, you are not legally required to add this charge until your business earns gross yearly sales of $75,000 or more ($150,000 if you are a non-profit).
Once you have hit the $75,000 threshold you will be required to register for GST. You can choose to register before this date if you would like. Many businesses choose to register before this date so they can claim GST credits on their start-up costs, allowing them to receive some of those costs back.
It is important to note that you cannot collect GST on your sales nor claim GST credits until you have become GST registered.    

What happens when you register for GST? 

When you register for GST you will need to begin collecting GST for the ATO. To make this easy, you should set up a separate bank account to store all GST you have collected. At the same time as registering you would have been asked when you would like to lodge a BAS. You would have been presented with three options:

• Annually: you can only select this if your Annual turnover is less than $75,000 or you are not a taxi/ride share driver.
• Quarterly: This requires you to lodge a BAS once every quarter, generally on the 28^th day of the month after the quarter has ended (so, for January – March you would lodge your BAS on the 28^th of April).
• Monthly: Monthly lodgement requires you to lodge your BAS on the 21^st of the following month (So, for May, you would lodge that months BAS on the 21^st of June).
  

What is involved with a BAS? 

As your business essentially becomes a tax collector for the ATO, when you are registered for GST, you will need to report the amount of GST you have collected. A BAS is essentially a form you fill out to tell the ATO how much GST you have collected based off sales you made during that BAS period (monthly or quarterly). When you lodge your BAS, you will also send all the GST you have collected to the ATO.
A BAS is also where you claim GST-credits. This will reduce the amount of GST you need to send to the ATO.

How do I lodge a BAS? 

The easiest way to lodge a BAS is through BASlodge.com.au. BASLodge are registered BAS agents, which allows you to receive many benefits. These include an extra 4 weeks extension to your BAS due date, support in preparing your BAS, and a team of experts who ensure that you have completed your BAS correctly before we send it to the ATO. With BASlodge.com.au lodging your BAS is an easy process with a simple form. Lodge your BAS with us today.