Accounting Services Perth
In Australia, businesses with an annual turnover of $75000 have to register for the GST, and every GST-registered business has to lodge the business activity statement (BAS) within its deadline. You may lodge it yourself or take help from one of the BAS agent services based in your area. However, people repeatedly make vital mistakes, leading to penalties. This blog discusses some valuable tips you may consider to avoid these common mistakes and prepare your BAS correctly.
Over the years, experts have observed the trends and have developed the following tips. Using these tips will reduce the risks of making common BAS mistakes pointed out by ATO.
While registering your business (having a turnover under $2 million) for GST with the Australian Taxation Office (ATO), you must choose the accounting method for your GST. There are two methods of accounting - cash and accrual.
Whatever method you choose, you must make the required update in your accounting system. Reports will be different for the two methods, so it will be important to print the correct ones.
If there are employees in your office, and more than $25000 is withheld per annum in Pay-As-You-Go withholding, you may be moved to a monthly lodgement cycle.
While calculating the amount of income tax payable by you, the ATO procedure sometimes lags 1-2 years behind ‘real-time.’ Situations may change over this period. A business may expand or shrink, and if such a thing happens, you may plan to vary or change the requested amount of income tax instalment.
One of the crucial mistakes people make is failing to lodge the BAS by the relevant deadline.
In your business activity statement form, the total sales for a specific period have to be entered in Box G1. In addition, you should also include any other amounts already reported in boxes G2 and G3. These amounts must be reported as GST-exclusive or GST-inclusive.
At the end of the financial year, the ATO thoroughly checks the lodged BAS and income tax returns to identify discrepancies. For this purpose, officials use cross-references, so it is important to report the revenue correctly.
You will always have the option to amend the BAS mistake in the next BAS. Revising the original BAS can also be possible, but everything will depend on whether the mistake is related to debit or credit.
Usually, business owners can correct mistakes related to fuel tax credit and GST in their next BAS. But, if you fail to do it, a revision must be lodged.
Many people ask about the specific BAS adjustment period to correct the mistake they have committed by overstating their GST liability. The ATO provides a time limit of four years to adjust, and this period is calculated from the time the mistake was made.
The whole process of preparation and lodgement of BAS is pretty complicated, so it will be a good idea to involve someone with years of experience. Whether correcting GST mistakes or hiring a professional accountant or bookkeeper, Accounting Services Perth is always here to help you. We are known for providing top-rated services in every area of accounting at affordable prices.