BAS Basics - Business Activity Statement for Beginners

What is a Business Activity Statement?

Businesses have very different tax obligations to individuals. Individuals have only one reportable tax: income tax, done on the annual tax return. Businesses have different tax obligations to individuals. Depending on the business, you may have any of the following to report:

  • GST
  • Pay As You Go (PAYG) Tax Instalements
  • PAYG Withholding tax for staff incomes
  • Fringe Benefits Tax (FBT)
  • Deferred Company Tax
  • Wine Equalisation Tax (WET)
  • Luxury Car Tax
  • Fuel Tax rebates

The Business Activity Statement is a system (either paper on online) that all businesses in Australia must use to report their tax obligations to the Australian Tax Office. The BAS is used to report how much taxes a business has collected, and how much taxes it owes, and then provides a summary of net payment or refund.

Goods and Services Tax (GST) is the biggest component of the BAS for most businesses. All Australian businesses earning over $75,000 must register for GST, which means they are then obliged to charge GST on most goods and services they provide, and they are also able to claim back the GST that other businesses have charged them.

Each quarter the ATO sends each business a BAS form, tailored to their tax reporting requirements. For example, if your business only reports GST, then you will probably receive BAS Form D and businesses with GST and PAYG Tax Instalments would receive BAS Form A.

While large businesses (turnover greater than $2 million) need to do a BAS monthly, most businesses do their BAS quarterly. You must lodge your BAS and pay your tax obligations by end of the month after each quarter, with an extra 2 weeks for businesses who lodge online. See our BAS Lodgement Dates page. There are penalties and interest charges for those that submit late.

You can either fill out the paper BAS form the ATO sends you, or register to complete your BAS online. Lodging online has the advantage of an extra 2 weeks to pay, which for most businesses with a tax payment obligation means cash on hand for that extra time. Note that online lodgement is essentially the same form as the paper one, and does not give you extra tools or calculators (thats where QuickBAS helps!).

Business Activity Statement
Business Activity Statement Basics