What To Not Report On Your BAS
A common mistake made by small businesses is to report items on their Business Activity Statement (BAS) which are not required to be reported. Reporting incorrectly can disproportionately inflate your business’ figures. As a BAS is specifically designed to determine how much of certain business taxes you owe to the ATO, inflated figures could cause a problem.
To help small business owners we have created this hand guide to items that should not be reported on your BAS.
Which items are not reportable?
To start with, here is a list of items that you do not need to report on your BAS:
- Wages – except if you are registered for PAYG Withholding, which you can report in the relevant section on your BAS
- Tax Payments
- Dividends received or paid
- Shareholder loans
- Private expenses, or the private portion of expenses
- Principal repayments on finance
- Non-deductible entertainment
- Stamp Duty
Each of these items may affect your profits, losses and trading figures. However, they are not a part of the GST requirements for your business, meaning they should not be reported on a BAS.
What will happen if I include them on my BAS?
If you include these items on your BAS, or report them incorrectly, you could be misrepresenting the figures around your business. This may trigger an ATO audit. As you report your BAS quarterly or monthly it will be extremely easy for the ATO to notice variances in what you reported on your BAS and what was reported on your tax return that year. The substantial variation will raise red flags when found.
To avoid this issue, lodge your BAS with BASLodge.com.au. As registered BAS agents, we will look over your BAS and ensure that you are reporting correctly before lodging with the ATO. If you have reported incorrectly, we will raise it with you and help you fix the problem.
What about GST free items?
You are required to report the sale and purchase of GST free items on your BAS. You will need to include their sale or purchase in total sales and purchases on your BAS. When you report the GST on your total sales or purchases you do not need to report any GST on these GST free items. Therefore, if you sell or purchase GST free items, the total GST reported on your BAS will not be exactly 1/11th of your total sales/expenses.
GST free items can include:
- Bank fees
- Milk, tea, sugar, coffee
- Overseas phone calls
- Overseas travel
- Stamp duty
- Google Ads
- Fines and penalties
- Bonds or deposits
- Certain components of motor vehicle registrations
How to lodge my BAS easily
To minimise your risk when lodging your BAS, you should lodge through a registered tax agent like BASLodge.com.au. We are able to provide a range of benefits designed to make the entire process easy. These services are on top of our simple form, making BAS easy.
Through BASLodge.com.au you receive the full support of our registered tax agents, allowing you to have any questions answered. Our tax agents will check your BAS before we lodge it to the ATO to ensure that it is completed correctly. You will also receive a four-week extension to the due date of your BAS through BASLodge.com.au. All of this will minimise risk to your business and make BAS time easy.
Lodge your BAS with BASLodge.com.au today.