BAS Guide: How to Lodge a Business Activity Statement

• 14 min read • Business Tax

Figuring out how to lodge a business activity statement is a rite of passage for Australian business owners. The Business Activity Statement (BAS) is the Australian Taxation Office’s (ATO) comprehensive tax reporting form. It tracks your Goods and Services Tax (GST), Pay-As-You-Go (PAYG) instalments, and other financial obligations that keep the bureaucratic wheels turning.

If you have an Australian Business Number (ABN) and GST registration, the ATO will automatically dispatch your BAS via post or email when reporting time rolls around. The frequency varies—some businesses submit monthly, others quarterly, depending on your GST registration and earnings. The ATO is extremely strict with lodgement dates, and supplying incorrect figures could end you up in hot water.

With so much at stake, we’ve developed the following guide to help you wrap your head around the intricacies of your BAS. By understanding the finer details of your Business Activity Statements, you can keep the ATO happy while gaining valuable insights into your business’s financial health. Whether you choose to manage your BAS independently or work with a business tax accountant, knowing your tax obligations can help you make smarter financial decisions, reduce your tax liability, and keep your business running smoothly.

Understanding Your Business Activity Statement: A Comprehensive Overview

The Business Activity Statement (BAS) isn’t a one-size-fits-all form. Instead, what you’re dealing with is a dynamic tax reporting tool that adapts to your specific business structure and operations. While it might seem overwhelming at first glance, the BAS is essentially a snapshot of your business’s financial activities, designed to help the ATO track various tax obligations.

In the sections that follow, we’ll break down the key components that might appear on your BAS. Not every section will apply to every business—your specific reporting requirements will depend on your business type, size, and activities. Whether you’re a small retail operation, a professional services firm, or a growing enterprise, this guide will help you understand which elements are most relevant to your financial reporting.

We’ll explore critical areas including:

  • Goods and Services Tax (GST)
  • Pay-As-You-Go (PAYG) Instalments and Withholding
  • Fringe Benefits Tax
  • Luxury Car Tax
  • Wine Equalisation Tax
  • Fuel Tax Credits

By the end of this guide, you’ll have a clear understanding of which tax components might apply to your business, how to calculate them, and how to ensure you’re meeting your ATO reporting obligations efficiently and accurately.

The Goods and Services Tax (GST)

GST is a broad-based consumption tax of 10% applied to most goods and services sold or consumed in Australia. For businesses, the rules are straightforward but critical:

  • Voluntary GST registration is possible for businesses with a turnover under $75,000 ($150,000 for not-for-profit organisations)
  • Mandatory GST registration is required for businesses with a turnover over $75,000
  • GST is calculated and collected on your sales and included in the final price
  • You can claim GST credits on your business expenses, which can help offset your tax liability

Key GST reporting requirements for Australian business owners:

  • Record all GST collected from sales
  • Track and claim GST credits on business expenses
  • Report these figures accurately on your BAS

Pay-As-You-Go (PAYG)

Australia’s PAYG system simplifies the way in which businesses contribute to their annual tax liabilities. PAYG comprises two critical mechanisms that help smooth out tax payments throughout the year, ensuring you can stay current with your obligations while avoiding significant end-of-year tax shocks.

By breaking down your tax responsibilities into manageable instalments and withholding requirements, the ATO provides a structured approach to tax management that supports businesses of all sizes. Let’s take a look at the two types of PAYG you need to understand in relation to your BAS.

PAYG Instalments

These are the periodic prepayments you’ll make towards your expected annual income tax. Your PAYG instalments:

  • Commence after your first tax return showing a profit
  • Credited against your end-of-year income tax liability
  • Calculated based on your previous year’s tax return

PAYG Withholding

If your business pays wages to employees, you must register for PAYG withholding. You’ll need an ABN to register. Once you’re all set up, you’ll need to:

  • Withhold the correct amount of tax from employee wages
  • Report gross wages and withheld tax amounts on your BAS
  • Remit these withheld amounts to the ATO
man and woman discussing lodging

Fringe Benefits Tax (FBT)

Fringe Benefits Tax (FBT) is a separate tax employers pay on non-monetary benefits provided to employees in addition to their regular salary or wages. When completing your Business Activity Statement (BAS), you’ll need to include any FBT amounts payable during the reporting period. This means if you have provided fringe benefits to employees during the BAS reporting cycle, you must calculate and report the FBT amount on your statement.

While FBT is not collected in the same way as GST, it is still a tax obligation that must be reported through your BAS. Some businesses may need to make FBT instalments or report their FBT liability, which is then reflected in their BAS submission. The key is to track and calculate the taxable value of any non-cash benefits provided to employees during the reporting period.

Here’s what you need to remember about FBT:

  • Tax on non-cash benefits provided to employees
  • Calculated separately from income tax
  • Based on the taxable value of fringe benefits
  • Reported as part of your Business Activity Statement

Luxury Car Tax (LCT)

Australia’s luxury car tax is essentially a surcharge for those who want to cruise around in something more exciting than a standard sedan. The ATO views high-end vehicles as surplus to requirement and has devised a tax that ensures luxury car owners contribute a little extra to the national coffers. It’s a bit like a wealth redistribution scheme with a sleek, chromed-out twist.

Here’s what you need to know about the LCT:

  • 33% tax on cars exceeding the luxury car threshold
  • Applies to dealers and individual importers of luxury vehicles
  • The luxury car threshold for the 2023-24 financial year is $89,332 for fuel-efficient vehicles and $76,950 for all other vehicles
  • For the 2024-25 financial year, it’s $91,387 for fuel-efficient vehicles and $80,567 for all other vehicles
  • Calculated on the amount above the threshold, not the entire vehicle price
  • Must be reported by businesses selling or importing luxury vehicles on their BAS

The tax is applied at the point of sale or import, making it a significant consideration for car dealers, importers, and individuals bringing high-end vehicles into Australia.

Wine Equalisation Tax (WET)

The WET only applies to wine manufacturers, wholesalers and importers, and is a tax based on the value of wine. The idea is to ensure every bottle of pinot noir or chardonnay contributes its fair share to government revenues. If you want to put a positive spin on it, the Wine Equalisation Tax turns every wine sale into a small contribution to national infrastructure.

Here are the key things to remember about the WET:

  • 29% tax on the value of wine
  • Applies to wine manufacturers, wholesalers, and importers
  • Calculated and reported as part of your Business Activity Statement
  • Requires detailed record-keeping of wine sales and values

Fuel Tax Credits

Fuel tax credits offer businesses a way to reclaim some of the fuel excise paid on business-related fuel consumption. When completing your BAS, you’ll have the opportunity to claim these credits, effectively reducing your overall tax liability by offsetting the fuel tax you’ve paid during the reporting period.

On your BAS, you’ll need to calculate and report the fuel tax credits based on the fuel used in eligible business operations, such as machinery, heavy vehicles, and off-road business vehicles. This process requires maintaining accurate records of fuel purchases and usage to substantiate your credit claim.

Here are the key points to remember about fuel tax credits:

  • They apply to machinery, heavy vehicles, and off-road business vehicles
  • They’re calculated and claimed as a credit on your Business Activity Statement
  • They require detailed documentation of fuel purchases and business use

READ TAX DEDUCTIONS FOR THE SELF EMPLOYED: KNOW WHAT YOU CAN CLAIM COME TAX TIME

How Often Do I Need to Lodge My BAS?

Even if your business has zero activity to report, you must still lodge a BAS if you’re GST-registered. This helps the ATO maintain accurate records of your business’s tax status. Think of it as an administrative check-in, regardless of whether you’ve had any transactions.

If you are voluntarily registered for GST and your GST turnover is under $75,000 ($150,000 for not-for-profit bodies), then you have the option to lodge a BAS annually by 31 October each year.

If your business earns above this minimum bracket but less than $20 million, you will have to lodge your BAS quarterly. 

Here are the BAS reporting dates and deadlines you need to know if you’re lodging quarterly:

  • July-September—Quarter 1—BAS due on 28 October
  • October-December—Quarter 2—BAS due on 28 February
  • January-March—Quarter 3—BAS due on 28 April
  • April-June—Quarter 4—BAS due on 28 July

If your business earns over $20 million, you’ll need to lodge your Business Activity Statements on a monthly basis. In this case, you’ll need to lodge them within 21 days of the month closing.

How Do I Lodge My BAS?

You can lodge your BAS statement online through your myGov account, through the ATO’s online business portal, or through a registered BAS agent. If lodging yourself, note that you’ll need to pay meticulous attention to detail, with multiple components to calculate, track, and report accurately.

You must carefully compile the required financial records, calculate precise tax obligations, and ensure every figure is correct. One miscalculation could trigger ATO penalties, making the lodgement process a high-stakes administrative challenge that can quickly consume valuable business hours.

Many Australian businesses wisely choose to work with an accountant or bookkeeper who specializes in BAS preparation, turning a potential administrative nightmare into a streamlined, stress-free process. ITP’s professional tax agents bring expertise that goes far beyond simply filling out forms. They understand tax regulations, can identify deductions you might miss, and ensure your Business Activity Statements always flow accurately and on time.

The cost of professional services is often offset by the tax savings they can uncover, the time they save you, and the peace of mind that comes from knowing your tax obligations are being handled by experts. Moreover, ITP’s skilled business accountants can help you develop better financial strategies, potentially improving your overall profitability while protecting you from costly mistakes or late lodgement penalties.

Are There Fines if I Don’t Pay My BAS?

Speaking of penalties, the consequences of missing BAS lodgement deadlines can be surprisingly severe. If you don’t submit your BAS on time, you’ll immediately trigger a failure to lodge (FTL) penalty that can quickly become a financial burden for your business.

The ATO imposes escalating fines to ensure compliance. These FTL penalties differ depending on the size of your company and the circumstances surrounding your late lodgment. And they aren’t just a one-time slap on the wrist—they can compound over time, potentially creating significant financial strain. What starts as a missed deadline can quickly snowball into a costly administrative nightmare, draining resources you could put to far better use.

How to Keep Your Profits Where They Belong

Between tracking GST, managing PAYG, and deciphering ATO requirements, most business owners would rather spend their time doing literally anything else. We get it. And that’s why we do what we do. ITP’s business tax services give you back the hours you’d waste wrestling with paperwork, freeing you to redirect that energy into actually growing your business.

The best tax professionals do more than prevent penalties. Part accountant, part strategist, and part financial detective, ITP’s tax agents will spot the deductions you missed, streamline your reporting, and ensure you’re not accidentally donating more to the ATO than necessary.

Your time is valuable. Your profits are precious. And your sanity is worth protecting. Speak to one of our tax professionals today, and turn your BAS headaches into a strategic advantage.