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Your Guide to BAS Due Dates 2023: A Must-Read for Small Business Owners

by | Apr 7, 2023 | Accounting and Bookkeeping, Business and Investment Structures, Tax and Compliance | 0 comments

Home | Articles | Your Guide to BAS Due Dates 2023: A Must-Read for Small Business Owners

The importance of the Business Activity Statement (BAS) for small businesses in Australia

Are you a small business owner in Australia struggling to manage your tax obligations effectively? The Business Activity Statement (BAS) is a crucial document that businesses must prepare and submit to the Australian Taxation Office (ATO) regularly.

As a small business owner, understanding and preparing your BAS accurately and on time is essential to avoid penalties, manage your cash flow, and gain insights into your business’s financial performance.

In this article, we’ll take a look at common problems you may face and how to prepare and lodge your BAS effectively. We’ll also provide practical tips and guidance to help you stay on top of your tax compliance obligations and make informed decisions for your business. So, whether you’re a sole trader or a small business owner with employees, keep reading to learn more about how managing your BAS effectively can help keep your business on track.

A person sitting at a desk, filing GST and PAYG to the Australian Taxation Office (ATO) through their computer. The Business Activity Statement (BAS) is crucial for small businesses in Australia to manage their tax obligations and gain insights into their financial performance.

Common problems encountered when preparing your BAS

Preparing your BAS can be a challenging and time-consuming task, and many small business owners encounter common problems along the way. Here are some examples:

Challenges of navigating the Australian tax system and the complexity of BAS lodgement

The Australian tax system can be challenging to navigate, particularly for those with little to no accounting experience. The tax codes and requirements can be complex and confusing, and it can be challenging to keep up with the changes and updates. As a result, you may struggle to understand the various taxes that need to be included in your BAS. This can lead to errors and inaccuracies which can also result in penalties and fines from the ATO.

Importance of organisation and record-keeping

If you do not have effective record-keeping systems in place, you may struggle with tracking your financial transactions and reconciling your BAS. Without proper organisation, it can be difficult to ensure that all transactions are accurately recorded and classified in the correct tax codes. This can lead to errors and omissions in the BAS, which can result again in penalties and fines from the ATO.
A cluttered desk with papers and documents scattered around. Small business owners may face challenges when preparing their BAS due to the complexity of the Australian tax system, record-keeping difficulties, and the importance of accurate classification of financial transactions.

Cash flow issues and the need to pay GST monthly and quarterly

You may find you’re struggling with managing your cash flow effectively, which can make it challenging to pay your tax liabilities on time. This can lead to additional penalties and fines from the ATO and negatively impact your business’s financial health.

To overcome these issues, you can take several steps. Firstly, you can seek professional assistance from an accountant or bookkeeper to help you navigate the tax system and ensure that your BAS is accurate and complete. Secondly, you can use technology tools such as accounting software or cloud-based solutions to streamline your record-keeping and financial reporting processes. Finally, you can prioritise effective cash flow management to ensure you can pay your tax liabilities on time and avoid penalties and fines from the ATO.

Important dates and deadlines for BAS in Financial Year 2023

As a small business owner, keeping up-to-date with your BAS lodgment and payment responsibilities is crucial. Here are the several important dates and deadlines to keep in mind for the 2023 financial year:
A table displaying the important dates and deadlines for Business Activity Statement (BAS) lodgment and payment in Financial Year 2023. Small business owners need to be aware of these dates to fulfill their BAS responsibilities on time.

Lodgement dates and the importance of meeting due dates to avoid penalties

Meeting deadlines is essential for the success of your business, and failing to do so can lead to missed opportunities, loss of credibility, and financial losses. Effective time management is key to meeting deadlines, allowing you to prioritise tasks, allocate resources, and avoid last-minute rushes or emergencies.

By planning ahead and meeting deadlines, you can reduce stress levels, build trust with your clients or customers, and improve productivity, which can help you achieve your business goals. Therefore, it is essential to prioritize being aware of due dates and planning accordingly to ensure the success and growth of your business.

A person working on a laptop with a deadline of one day left. Meeting deadlines is crucial to the success of your business, and effective time management can help prioritize tasks, avoid last-minute rushes, and reduce stress levels.

Consequences of missing the due dates – Avoid ATO Penalties!

If a business misses the due date for lodging and paying their BAS, it can have severe consequences. The ATO may impose a range of penalties, including late lodgment penalties, general interest charges (GIC), and even legal action.

The late lodgment penalty is calculated based on the number of days the BAS is overdue and the business’s annual turnover. For small businesses with an annual turnover of less than $10 million, the penalty can range from $210 to $1,050 per BAS statement.

In addition to late lodgment penalties, the ATO may also charge GIC on any unpaid amounts. GIC is calculated daily and applied to the outstanding balance, including the unpaid penalty amounts. The GIC rate is updated quarterly and is currently set at 7.76% per annum.

The ATO may also impose an administrative penalty if a business provides false or misleading information on their BAS or fails to provide information requested by the ATO. The administrative penalty can range from $210 to $10,500, depending on the severity of the breach.

If a business fails to lodge and pay their BAS for an extended period, the ATO may take legal action to recover the outstanding amounts, including garnishing wages, issuing a director penalty notice, or even liquidating the business.

Overall, the consequences of missing the due dates for BAS can be severe, therefore, it is important to plan ahead, meet the due dates for BAS, and ensure compliance with all taxation requirements.

A person with a worried expression on their face, looking at a calendar with a looming deadline. Meeting due dates is critical to avoid penalties and maintain credibility and productivity in business operations. Effective time management and planning ahead are essential to meet deadlines and achieve business success.

Businesses may be eligible for exceptions or extensions for the BAS due dates, including the role of a tax agent

In certain circumstances, businesses may be eligible for exceptions or extensions for the BAS due dates. These exceptions or extensions are typically granted by the Australian Taxation Office (ATO) on a case-by-case basis.

Here are some situations where businesses may be eligible for an exception or extension for the BAS due dates:

table listing some of the exceptions or extensions that businesses may be eligible for regarding the Business Activity Statement (BAS) due dates. The ATO may grant these exceptions or extensions on a case-by-case basis. The table also mentions the role of a tax agent in helping businesses manage their tax compliance obligations and navigate the BAS process.
These exceptions and extensions are not automatic. If your business requires additional time or an exception for the lodgment, communicate with the ATO as soon as possible and provide supporting documentation for your request.

Different ways to lodge the BAS

The Australian Taxation Office (ATO) offers various options to make the BAS lodgement process more accessible and convenient for businesses.

Online

The most common and preferred method to lodge the BAS is online via the ATO’s Business Portal. The Business Portal is a secure online platform that allows you to lodge and manage your BAS and other taxation obligations.

Your Registered Tax Agent

You can also use the help of registered tax agent to lodge your BAS on your behalf. Tax agents have specialised knowledge and expertise in taxation matters and can help businesses ensure compliance with all other taxation requirements.

Through Phone

In some cases, businesses can lodge their BAS over the phone using the ATO’s automated voice system. This option is suitable for businesses that have simple taxation obligations and prefer a quick and easy way to lodge their BAS.

By Mail

Businesses can also lodge their BAS via mail by completing and sending a paper form to the ATO. However, this method is less commonly used and may take longer period to process compared to online lodgement.
An image with different directional arrows pointing to the different ways to lodge the Business Activity Statement (BAS) - Online via the ATO's Business Portal, through a registered tax agent, over the phone using the ATO's automated voice system, and via mail by completing and sending a paper form to the ATO. These options are designed to make the BAS lodgment process more accessible and convenient for businesses.

How to make payments

Once your BAS has been lodged, you are also required to make the corresponding payment to the ATO by the due date. Here’s how to make payments for your lodged BAS:

Online

The most common and preferred method to make BAS payments is online via the ATO’s Business Portal. Businesses can use their preferred payment method, including credit/debit cards or bank transfers, to make the payment online.

BPAY

Businesses can also make a BAS payment using BPAY. BPAY is a secure and convenient way to pay bills online or over the phone via the business’s bank account.

Direct Debit

Direct Debit is a popular payment method for businesses that want to automate their BAS payments. Businesses can set up a Direct Debit arrangement with the ATO and authorize the ATO to deduct the amount owing from their nominated bank account.

Mail

Businesses can also make a BAS payment by mailing a cheque or money order to the ATO. However, this method is less commonly used and may take longer to process.

Benefits of quarterly reporting for small businesses with a GST turnover of less than $10 million.

Wrangling your BAS can be a real headache, but it’s super important for small business owners in Australia to stay on top of it. By knowing the BAS due dates, keeping your records organized, and leveraging tech tools like accounting software, you can take the hassle out of BAS lodgement.

If your business makes less than $10 million in GST turnover, quarterly reporting can help you stay on top of your cash flow and streamline your BAS lodgement process. Keeping up with your BAS obligations is a must if you want to avoid getting slapped with fees and penalties from the ATO, and it’ll give you peace of mind knowing your finances are in good shape.

Complying with BAS obligations and maintaining a healthy financial position for small businesses

Complying with your BAS obligations is of utmost importance for business owners in Australia. To avoid penalties and interest charges from the ATO, it’s crucial to ensure that you lodge your BAS on time and pay any outstanding amounts by the due date.

Seeking professional advice from taxation experts can provide invaluable support in navigating the complexities of BAS lodgement and payment. By proactively staying on top of your BAS obligations and maintaining compliance, you’ll be taking a significant step towards safeguarding your business’s financial position.

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Disclaimer

This outline is for general information only and not as legal, tax or accounting advice. It may not be accurate, complete or current. It is not official and not from a government institution. Always consult a qualified professional for specific advice tailored to your unique circumstances.

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