When it comes to managing your business finances, a few tasks are as crucial as lodging your BAS (Business Activity Statement).
If your business has been operating for some time and is registered for GST (Goods and Services Tax), lodging your BAS is mandatory. For those unfamiliar, BAS is a form that businesses use to report their tax obligations and submit it to the Australian Taxation Office.
At RV Advisory Group, we understand that getting it right is crucial for compliance and financial health. Here are essential guidelines to help you with the do’s and don’ts of BAS lodgement.
Business activity statements help in reporting and paying the following:
- goods and services tax
- PAYG withholding tax
- pay-as-you-go (PAYG) installments
- other taxes
Once you register for an ABN (Australian Business Number) and GST, the Australian Taxation Office will automatically send you a BAS at the time of lodgement.
If you’re new to BAS lodgement, you can rely on bookkeepers, accountants, tax or accounting software, or the ATO’s website to help you prepare and submit it. RV Advisory Group, with its team of experienced bookkeepers and accountants, can simplify the process and take the stress out of lodging your BAS.
If you want to learn how to streamline the lodgement process and understand the key do’s and don’ts, keep reading.
Key Do’s for BAS Lodgement
Maintaining Accurate Records
Accurate record-keeping is crucial for BAS lodgement. Be sure to meticulously track all financial transactions, including income, expenses, and GST-related activities.
Good record management not only streamlines the lodgement process but also reduces the chances of errors.
Lodging Your BAS on Time
It’s essential to lodge your BAS by the due date. Failing to meet deadlines can lead to penalties and interest charges. Prioritize submitting your BAS on time, whether it’s a quarterly or annual lodgement.
Reviewing Figures Carefully
Before lodging your BAS, thoroughly check all figures and calculations for accuracy. Even small mistakes can cause compliance issues and attract additional scrutiny from the ATO.
Seeking Professional Guidance
If you’re uncertain about any aspect of BAS lodgement, consult with a qualified accountant, BAS agent, or registered tax agent. Their expertise can help ensure you’re complying with ATO regulations and avoid potential issues.
BAS Lodgement: What Not to Do
Neglecting GST Responsibilities
Businesses are required to meet their GST obligations by reporting and paying GST on taxable sales, as well as claiming input tax credits for GST paid on business expenses. Failure to do so may lead to penalties and fines.
Mixing Personal and Business Expenses
To ensure accurate financial reporting on the BAS, businesses must keep personal and business expenses separate. Combining these can result in errors and increase the risk of audit complications.
Over-Reliance on Software
While accounting software can make the BAS lodgement process easier, it’s not infallible. Always double-check the accuracy of your financial data, and seek professional advice if necessary.
Overlooking Income Declarations
It’s crucial to report all income, not just sales revenue. This includes cash transactions, one-time sales or transactions (such as selling equipment). Declaring all forms of income is essential for proper BAS reporting.
Claiming Expenses You’re Not Entitled To
Determining which expenses you can claim can be complicated. For instance, entertainment expense is a non-deductible expense. It’s important to conduct thorough research to understand which expenses you’re legitimately entitled to claim.
In conclusion, understanding the dos and don’ts of BAS lodgement is vital for businesses in Australia. By following best practices and steering clear of common mistakes, businesses can ensure compliance with tax regulations and avoid penalties.
Staying organized, seeking professional advice when necessary, and keeping up to date with changes in tax laws are key to successful BAS lodgement.
At RV Advisory Group, we provide accurate support, advice, and services to help you lodge your BAS (Business Activity Statement). Whether you’re new to the process or have prior experience, we can assist you at any stage.
With our advisory services and extensive expertise, we can help ensure that you remain compliant with all your obligations. Contact RV Advisory Group today. Our experienced team is here to provide you with accurate support and advice tailored to your needs. Reach us at (03) 9424 2774 or 0420 661 881, or email us at [email protected]. As a leading accountant service in Epping and providing Bookkeeper services in Campbellfield, we are committed to ensuring your business remains compliant with all its tax obligations.