GST and BAS

GST (Goods and Services Tax) is a tax that businesses charge on their sales. The customer pays it to the business, but the business must report the GST it charged and the GST it paid to other businesses, and pay the net amount to the ATO. That report is the BAS (Business Activity Statement).

Do you have to register for GST?

You must register once any of these is true:

Your GST turnover reaches $75,000 a year – $150,000 for not-for-profits
You expect to reach the turnover threshold. The test is forward-looking, not just what you have already invoiced
You provide taxi, limousine or ride-sourcing services – from the first dollar, with no threshold at all

You have 21 days to register once you meet the test. Miss that and the ATO can backdate your registration, which means you owe one-eleventh of everything you invoiced in the meantime – out of your own pocket, because you did not charge it at the time. That is the single most expensive GST mistake we see.

We can help with GST and make it straightforward. Not sure whether you have crossed the threshold, or when you will? Talk to us – a short conversation now is much cheaper than a backdated registration.

Do you want to register for GST?

If you do not reach the threshold, you can still register – and for some businesses that is the better decision. It turns on two questions: who your customers are, and how much GST you are already paying out.

Your customers are GST-registered

Then the GST you add costs them nothing – they claim it back on their own BAS. Your price is effectively unchanged to them, while you start claiming credits on your own costs. This is the case where registering early is close to free money.

You have real input costs

Stock, materials, equipment, subcontractors, software, rent. Every one of those carries GST you currently absorb. Registered, you claim it back. The more you spend to earn your income, the more registering is worth.

You sell to the public

The opposite. Consumers cannot claim anything back, so you either raise your price 10% and become less competitive, or hold it and give up 9.09% of your revenue. Below the threshold, staying unregistered is usually the stronger position.

You want to look established

GST registration shows publicly on ABN Lookup, alongside your ABN. An unregistered ABN signals a business turning over under $75,000 – which is the inference you may not want a larger client or a procurement team drawing.

Worth doing the sums before you commit: registering is straightforward, cancelling later is more awkward, and the right answer depends on your customer mix. Talk to us and we will work it out with your actual numbers.

How GST works, in one line

GST is 10% of the price before GST – which makes it one-eleventh of the total your customer pays. Add GST by multiplying by 1.1; find the GST inside a total by dividing by 11.

Worked examples both directions, which supplies carry GST at all, and where it usually goes wrong: how to calculate GST.

What actually goes on a BAS

Despite the name, the BAS is not only about GST. Depending on your registrations it reports:

GST collected on sales and paid on purchases
PAYG withholding – tax withheld from employee wages
PAYG instalments – prepayments toward your own income tax
Fuel tax credits, where your business uses fuel in machinery or heavy vehicles
FBT instalments, wine equalisation tax and luxury car tax, where they apply

This is why a BAS problem is rarely just a GST problem, and why the statement is worth reconciling against your accounts before it goes out rather than after the ATO asks.

When it is called an IAS instead

The GST is what makes it a Business Activity Statement. Take the GST off and the same form is an Instalment Activity Statement (IAS) – same obligations, same lodgement, different name.

You will see one in two situations:

You are not registered for GST but still have PAYG withholding or PAYG instalments to report. There is no GST to include, so it arrives as an IAS.
You report GST quarterly but withhold PAYG monthly. The quarter-end month is a BAS; the two months in between are each an IAS.

What lodging through us actually gets you

More time

Registered tax agents get extended lodgement deadlines – roughly four extra weeks on each quarterly statement. The same statement, with room to get it right instead of filing it the night before.

Expertise you do not have to acquire

Which credits are claimable and which are not, whether cash or accruals suits your cash flow, what is GST-free and what is input-taxed. Keeping up with that is our job. It does not need to become yours.

One less thing to carry

The quarter stops arriving as a deadline you have to prepare for. Where we also do your bookkeeping, the statement is a by-product of records that already reconcile – not a job that begins when the reminder lands.

Getting to know your business

Preparing your statements each period means we come to know your numbers. If you ever want more than compliance – reporting, analysis, a second opinion before a decision – our other services are there when you want them, and not before.

Thresholds, cycles and methods

Three things move together as a business grows: whether you must register, how often you report, and which accounting basis you are allowed to use. This is the whole picture in one place.

GST turnover	Registration	Reporting cycle	Accounting basis
Under $75,000	Optional	Annual, quarterly or monthly – your choice	Cash or accruals
$75,000 – $10m	Required	Quarterly, or monthly if you prefer	Cash or accruals
$10m – $20m	Required	Quarterly, or monthly if you prefer	Accruals only
$20m and above	Required	Monthly	Accruals only

The registration threshold is $150,000 for not-for-profits. Annual reporting is only available where registration was voluntary – see above.

When each one is due

Cycle	Due
Quarterly	28 October, 28 February, 28 April, 28 July
Monthly	21st of the following month
Annually	With your income tax return

Cash or accruals

Under $10 million the basis is your choice, and it changes when the GST falls due rather than how much you pay.

Cash basis

You report GST when money actually moves. If a customer has not paid you, you do not owe the GST on that invoice yet. Suits businesses that invoice on terms and wait to be paid.

Accruals basis

You report GST when the invoice is issued, paid or not. That can mean remitting GST on money you have not received – but it also lets you claim credits earlier on your own purchases.

Most small businesses that carry receivables are better off on a cash basis. It is not automatic, and switching later is possible but has to be done deliberately.

Changing your cycle

The cycle you start on is not fixed. You can generally report more often than required, and that is worth considering in two cases:

You are regularly in refund – exporters, or a business making large capital purchases. Quarterly reporting means the ATO holds your money for three months at a time; monthly gets it back four times as often.
Quarterly bills are painful. Some businesses would rather pay smaller amounts monthly than find a large sum every quarter.

Moving the other way – monthly back to quarterly – is available once you are under the $20 million threshold that made monthly compulsory.

Two practical points. Changes take effect from the start of a reporting period, not partway through, so the timing of the request matters. And the annual election has its own deadline each year.

Changing cycle is a short conversation and it can materially improve cash flow, particularly if you export or you are carrying big capital spend. Talk to us before the next period starts.

When a statement was lodged wrong

It happens, and it is fixable. Small errors can usually be corrected on a later BAS within the ATO's correction limits; larger ones need a revision. Either way, voluntarily correcting an error is treated very differently from waiting for the ATO to find it.

Late lodgement carries a penalty even when no GST is owed, and it accrues per statement – so a business that has quietly stopped lodging is usually facing more than it expects, and the position stops worsening the moment someone takes it in hand.

We take on messy histories – missed quarters, statements prepared from incomplete records, businesses that stopped lodging and want to come back into line. Overdue lodgements and payment plans are part of our disputes and compliance work.

How this fits with everything else

The BAS is only as good as the bookkeeping under it. Where we do the bookkeeping, the statement is a by-product of records that are already reconciled rather than a scramble every quarter. And because the same statement reports PAYG, it connects directly to tax planning – your instalments are a prepayment of the tax bill we are trying to shape.

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