Small Business Bookkeeping Explained Part 1: What is BAS
When you’re running a small business, there’s a lot to do. So much more than just the product or service that you’re providing to your clients. The administration tasks that come with running your own business can be brutal, and unexpected!
A lot of our clients come to use after spending the time trying to do their bookkeeping themselves. They’ve fought, and lost the battle to do their own small business bookkeeping. Some have even gotten their books into such a mess that they’re embarrassed to ask for help.
If this sounds all to familiar, take comfort in the fact that you’re not alone.
But don’t leave it too long! It’s a vicious circle that too many small business owners are falling into and never getting out of. It can lead to audits, financial penalties and even missing money that no small business can afford!
So in the spirit of supporting small business we thought we’d share some of our knowledge and try to detangle some of the information for you. If you’re planning to start a small business, or you’ve just started one, and you’re unsure about the bookkeeping side of things, then this is for you.
Over the next few weeks we’ll be explaining, in plain English, the most important aspects of small business bookkeeping. Of course you can save yourself the time and hassle and just have us do it all for you but if you’re not quite there yet then this info will be a big help.
What is BAS?
The first thing that we’re going to take a look at is BAS. And that’s because it’s one of the fundamental parts of tax reporting for your small business.
A Business Activity Statement is the tax obligation for small businesses who are registered for GST. In its simplest form, BAS is a form that needs to be lodged with the ATO quarterly that reports your the amount of GST that your business must pay to the ATO.
BAS reporting includes:
- Pay As You Go
- Goods & Services Tax
- Fringe Benefits TaxT
- Luxury Car Tax
- Fuel Tax Credits
- Wine Equalisation Tax
If you’re operating as a sole trader, or a small business that’s earning less than $75,000 per year, then you may not need to register for GST. And if you’re not GST registered, then you won’t have to lodge BAS each quarter.
If you assume responsibility for doing and lodging BAS yourself, the liability for any errors and short payment is on your shoulders and you may be subject to an audit.
How to Lodge BAS
BAS needs to be lodged every quarter through the ATO. You can lodge online through your myGov account. Here you can view, revise and lodge your activity statement at any time.
BAS Due Dates for Lodgment
- Q1: 28 October
- Q2: 28 February
- Q3: 28 April
- Q4: 28 July
If however, you are working with a BAS Agent, your business will be eligible for a four week extension on all lodgment dates. That means that not only will you have less work to do in sorting your records, but you even have more time to ensure they’re all correct.
Lodgement Extensions for BAS Agents
- Q1: 25 November
- Q2: 28 February (As this date is already 8 weeks following the end of the quarter, there is no additional extension)
- Q3: 25 May
- Q4: 25 August
How Bookkeeping Services Can Help You
If you work with a professional and qualified bookkeeper, you can relieve yourself of some stress and rest assured that your BAS will be lodged on time and correctly.
When you’re choosing your bookkeepers to help with BAS, be sure to look for an experienced bookkeeper who is also a BAS Agent. These agents are issued with licenses allowing them to advise and represent you to the tax office in relation to your BAS.
A BAS Agent can help your bookkeeping by…
- Prepare and lodge your BAS documents accurately and on time
- Get an extension for when you BAS needs to be lodged
- Correctly set up GST codes and tax invoices
- Advise and set up the best software accounting system for your business
If you’re ready to leave the stress and confusion behind and focus on what you do best, then it’s time to work with a qualified and experienced BAS agent.
For all your small business bookkeeping needs, call us today on 1300 900 938 or get in touch online for a confidential and completely free chat about your books.
Join us again for Part 2 of our Small Business Bookkeeping Explained where we tackle PAYG.