From the end of March the clock is ticking for SMEs to lodge their BAS statement. Don’t leave it to the last minute and certainly don’t go over the deadline. By TERRY HAYES of Thomson Legal & Regulatory.
By Terry Hayes of Thomson Legal & Regulatory
The GST system introduced SMEs to the wonderful world of the business activity statement (BAS) or, if a business is not registered for GST but has PAYG (pay as you go) withholding obligations, the instalment activity statement. For SMEs generally, lodging these statements is a quarterly chore. If an SME lodges its BAS through its tax agent, then the accountant doesn’t want a last-minute rush of details to complete before the deadline.
The current quarter ends on March 31 so the lodgment deadline is approaching fast, and SMEs need to be organised so they lodge on time (even if they can’t pay) and don’t risk penalties for late lodgment. Lodgment of the quarterly BAS is generally due within 28 days of the end of the quarter, although it is useful to remember that if a due date falls on a Saturday, Sunday or public holiday, the relevant lodgment or payment can be made on the first business day after the due date.
Of course, SMEs also need to be aware that, if they provide fringe benefits to their employees, they will have to not only lodge a quarterly BAS by March 31 but also an FBT return (although these usually don’t need to be lodged until May 21 following the end of the FBT year). That just means more paperwork to get in order.
Although most SMEs are likely to lodge their activity statements through a tax agent, the tax office offers a wide range of facilities for those businesses that wish to do it themselves.
SMEs can lodge and revise most types of activity statements through the tax office’s business portal. They will receive instant confirmation by receipt that their activity statement has been lodged, and they can also view, print and list previously lodged statements. This is a useful facility for SMEs that are confident they have their figures right.
The tax office also offers taxpayers the opportunity of extra time to lodge and pay their activity statements. If taxpayers lodge and pay online, they you may qualify for a two-week deferral of their activity statement due date. This is worth exploring with your accountant, although there are conditions attached.
SMEs can also use the tax office business portal to view their account details, request transfers and refunds of credit balances, view and update registration details and send and receive secure messages. The business portal is a secure website, but SMEs need to register for a free tax office digital certificate to access it. Once the SME has installed its certificate, it is ready to access the business portal and lodge its activity statement.
SMEs can even pay their tax obligations online using Bpay. Again, these are useful features offered by the tax office and can save time for the organised business. Alternatively, an SME might feel more comfortable in providing all the relevant details to its accountant who will then lodge the BAS, etc.
Where an SME has a nil activity statement, these can be lodged by calling the tax office on 13 72 26. To use this service, the business must have its tax file number or Australian business number and the document identification number (DIN) for the statements to be lodged.
An SME that pays its GST on a quarterly basis also has the option of paying a quarterly GST instalment worked out by the tax office, but only reporting annually. This last choice is only available to businesses with an annual turnover of $2 million or less that have submitted two quarterly BAS forms. If this option looks attractive, talk to the tax office or to your accountant.
Calculating and paying GST on time, and lodging the BAS on time are indeed chores for most SMEs. They have to be done, but the pain can be minimised if the business has good records and is organised enough to be able to meet these tax obligations as they fall due. The tax office offers many facilities to help businesses with these tasks, so don’t hesitate to make use of them. A business can even calculate its own GST if it wishes by using an ATO electronic worksheet (NAT 5107) available on its Website at www.ato.gov.au (select “Forms & services” from the left navigation bar).
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Notwithstanding this, it is essential to get these things right and not to incur penalties. SME owners and operators are invariably flat out running their businesses, so attending to tax obligations like the BAS are not always “top of mind” issues for them. If that means they need to use an accountant, then do it. But don’t miss that deadline and make sure you give your accountant enough time to get your BAS information together.
Terry Hayes is the senior tax writer at Thomson Legal & Regulatory, a leading Australian provider of tax, accounting and legal information solutions; www.thomson.com.au
To read more stories on tax by Terry Hayes click here.