All GST registered business owners must lodge a Business Activity Statement (BAS) for each period, whether it be monthly or quarterly. Even if your business has not traded, that is, received income or incurred expenses, it is still vital that you complete the form and lodge it with the ATO. If you don’t submit your BAS on time you may fall subject to a failure to lodge (FTL) penalty. Larger fines will be levied if you are often late in lodging your BAS.
The BAS is a pre-printed document issued by the ATO either on a monthly or quarterly basis. The BAS summarises the amounts of GST payable and receivable for the relevant period and a range of other taxes including PAYG withholding and ABN withholding. The document’s aim is to allow a business to report and pay a number of tax obligations in one transaction.
If the BAS you submit contains information that is not correct, the least you will be charged – in the case of a genuine mistake – is general interest on the underpaid tax or extra credit received. If however, the mistake was attributable to carelessness or purposefully ignoring the law, you will be charged a penalty based on a percentage of the shortfall amount in question – the exact percentage charged will be dependent on the reason for the incorrect amount.
Your business activity statement may include some of the following:
• Goods and Services Tax (GST)
• PAYG income tax instalment (PAYGI)
• PAYG tax withheld (PAYGW)
• Fringe Benefits Tax (FBT) instalment
• Luxury car tax
• Wine equalisation tax
• Fuel tax credits
After the ATO has processed your income tax return or activity statement, you will either owe money (a tax debt), or you will be entitled to a refund.
If you do not receive your refund or the refund you receive is less than what you expected don’t be alarmed. Some reasons for this include:
• Part or all of the refund has been retained by the ATO in a process known as offsetting. This means that the retained capital is used to pay back an already existing tax debt.
• You haven’t nominated a bank account for the ATO to pay your refund into, or the bank account details you provided are incorrect or incomplete.
• You forgot to lodge one or more of your activity statements.
• The details shown on your return or activity statement need checking or verification.
Lodging a BAS can be a difficult and highly stressful process and can also become quite costly if specific guidelines aren’t followed. Therefore, we recommend that you seek professional advice while completing these documents.
Due to our recent experience we cannot stress enough how important it is to lodge your Business Activity Statement on time. The Tax Office are particularly zoning in on tax fraud at the moment and it is getting harder and harder to get away with being non-compliant. Here at The Quinn Group our experienced team of accountants can take the pressures off you and your business when it comes time to complete your BAS. For more advice click here to submit an online enquiry, or call us on 1300 QUINNS (1300 784667) or on +61 2 9223 9166.