The deadline for Australian small businesses to lodge their Business Activity Statements (BAS) and make sure all GST records are up to date is quickly approaching. If you’re armed with the correct tools, know when to seek advice, and are prepared to handle mistakes if and when they happen, you can navigate the process quickly and efficiently — all while keeping your business running smoothly.
After yet another year of ‘business as unusual’, preparing to lodge your BAS can feel overwhelming. Here are simple tips that will set you up for a streamlined reporting season.
Understand what you’re filing for
A BAS is required of all businesses that are registered for GST. Your BAS will let you report and pay your:
- goods and services tax (GST)
- pay as you go (PAYG) instalments
- PAYG withholding tax
- other taxes
A BAS is a business tax reporting obligation. Depending on the size of your company, you might be required to submit a BAS between one and twelve times a year, or not at all. The Australian Tax Office uses the information within your BAS to calculate your GST refund or bill, as well as your business’ income tax, your employee’s income tax, fringe benefits tax, and more.
Know what you need
When it comes to meeting your BAS obligations, preparation is key. Maintain up-to-date records to streamline the process. Some recommended habits for good bookkeeping are:
- Keep accurate, digital records of sales, business fees, wages, and all business-related expenses.
- Keep relevant records, for example stocktake records.
- Regularly reconcile sales with bank statements. Some EFTPOS systems, such as Zeller, make this easy by giving you real-time visibility of transactions via reporting dashboards.
- Always use a consistent GST accounting method. GST calculators are available, but always double check — just in case.
Once you have your paperwork sorted, look into what you should and shouldn’t submit; all resources are readily available on the Australian Government’s ATO website. Knowing when not to claim is equally as important as knowing when to claim. For example, imported goods, purchases made between entities within a GST group, and purchases that don’t include GST in their price cannot — and should not — be claimed. Do your preparation and due diligence to ensure you make the correct claims and lodgements
Make sure you set yourself up for future success by following the ATO best practice recommendations, and holding on to all your tax invoices and GST records for up to five years.
Ask for advice
Asking for support from an accountant or experienced peers can be valuable — however, ensure your bank statements and EFTPOS statements are in order so you don’t waste time or money. If you do choose to go to an accountant without having your paperwork in order, you run the risk of running up a hefty bill unnecessarily.
If professional help isn’t available, look to peers within your industry who have experience in the area. Even if you think you have a reasonable grasp on your submission, it can be useful to seek someone with experience of these lodgements to cast a second eye over it for errors or omissions.
There are also a number of accounting tools you could consider implementing, to make the next tax season easier.
Put your terminal to work
One of the benefits of using a fully-integrated financial services solution is that you get a complete overview of your business cash flow.
By simplifying the financial elements of your business with a holistic solution like Zeller, you’ll be able to review dashboards and download data that can easily be sent across to your accountant when lodging your BAS. The dashboard even shows you the exact amount of GST your business will be required to pay, in any given month.
By using software to gather this information, you minimise the risk of human error and can streamline the process of lodging your taxes.
Mistakes happen — know how to handle them
Using the correct software is critical for avoiding human error, yet mistakes can still happen. Being prepared and knowing how to handle them is important to ensure you’re not spending endless hours fixing errors, when you could be working on your business.
If you have followed the steps above and done your research prior to lodging and attempting to claim your tax, then you should only be at risk of minor errors — such as changes in activity figures if goods have been returned, a sale has been cancelled, or pricing has changed. Access to real-time sales figures will minimise the chance of these mistakes occurring. However, if you find there has been an error, you can simply correct these figures in your next BAS statement. It will not impact you negatively as long as you make the changes within the four year time limit for claiming credit and refunds.
The BAS deadline is creeping up quickly, but by following the above tips you will avoid last minute panic. You might already have implemented some of them without realising but, if not, consider using as many as you can to set yourself up for success ahead of the next filing deadline. While you’re in the tax lodgement frame of mind, use it as an opportunity to revise your bookkeeping processes and reassess whether your current tools meet your business and accounting needs. You should be able to rely on tools, like reporting functionality within your business’ EFTPOS machine, to do some of the heavy lifting.
Don’t be daunted by the process. Instead, familiarise yourself with the requirements, gather your paperwork, ask for advice, and put your tech to work to get your paperwork in on time.