Simpler BAS Lodgement for Small Business – Save Time and Stay Compliant

Lodging Business Activity Statements (BAS) is a key responsibility for small businesses, but the process can be time-consuming and complex. The Australian Taxation Office (ATO) introduced the Simpler BAS system to streamline BAS reporting and reduce the reporting burden for small businesses. Here’s how to use Simpler BAS to lodge your BAS quickly and accurately.

What Is Simpler BAS?

Simpler BAS is a streamlined reporting method designed to simplify BAS lodgement for small businesses with an annual turnover of less than $10 million. Under Simpler BAS, businesses only need to report:

• 1A – GST on Sales
• 1B – GST on Purchases
• G1 – Total Sales

This means fewer reporting labels and less paperwork, making it easier to lodge BAS accurately and on time.

Benefits of Simpler BAS for Small Businesses

The Simpler BAS system offers several benefits for small businesses, including:

• Less Paperwork: Only three key GST labels to report, reducing the amount of data entry.
• Time Savings: Streamlined reporting means less time spent on BAS preparation and lodgement.
• Reduced Errors: Fewer reporting labels minimise the risk of mistakes and potential ATO penalties.
• Improved Cash Flow: Easier reporting helps businesses stay on top of GST obligations and avoid unexpected liabilities.

Who Is Eligible for Simpler BAS?

The Simpler BAS system is available to small businesses with an annual turnover of less than $10 million. This includes sole traders, partnerships, companies, and trusts registered for GST. Eligible businesses are automatically transitioned to Simpler BAS by the ATO and notified via MyGov or business mail.

How to Lodge Simpler BAS – Step-by-Step

Follow these steps to lodge Simpler BAS for your business:

• 1. Collect Financial Data: Gather sales, purchase, and GST data for the BAS period. Ensure all transactions are recorded accurately in your accounting software.
• 2. Calculate GST on Sales (1A): Sum up the GST collected on sales during the reporting period. Include GST from all taxable sales, excluding GST-free sales.
• 3. Calculate GST on Purchases (1B): Calculate the GST paid on business-related purchases. This includes GST on goods, services, and expenses.
• 4. Calculate Total Sales (G1): Enter the total sales amount, including GST. Ensure that GST-free and input-taxed sales are also included in the total.
• 5. Lodge BAS via ATO Online Services: Log in to the ATO’s online services for business or use your accounting software to lodge the BAS report.
• 6. Pay GST Liability: If the GST on sales (1A) exceeds the GST on purchases (1B), pay the net GST amount to the ATO. If 1B exceeds 1A, you may be eligible for a GST refund.

Common Mistakes to Avoid When Lodging Simpler BAS

To avoid errors and potential penalties, watch out for these common BAS mistakes:

• Incorrectly categorising GST-free sales as taxable sales
• Forgetting to include GST on purchases that are partially used for private purposes
• Failing to reconcile BAS data with bank statements and accounting records
• Omitting income from other business activities, such as asset sales or interest income

How Accounting Software Can Simplify BAS Lodgement

Using accounting software like Xero, MYOB, or QuickBooks can streamline the BAS lodgement process by automating calculations, generating reports, and tracking GST obligations in real time. These platforms also integrate with the ATO for direct BAS lodgement, reducing manual data entry and minimising errors.

Need Help With BAS Lodgement?

Navigating BAS lodgement can be complex, especially if you’re new to the Simpler BAS system. Northern Beaches Bookkeeping Solutions provides expert BAS services to ensure accurate reporting, timely lodgement, and ATO compliance. Contact us today for stress-free BAS management and bookkeeping support.

Now Is the Time to Catch Up on Bookkeeping – Get Your Books in Order

Has your bookkeeping fallen behind? It happens to the best of us – but waiting until tax time to organise your financial records can lead to costly errors and missed deductions. Now is the perfect time to catch up on bookkeeping, get your accounts in order, and stay compliant with ATO reporting requirements. Here’s a step-by-step guide to getting your books back on track.

Why Catching Up on Bookkeeping Is Important

Delaying bookkeeping tasks can create serious financial and legal risks for your business, including:

• Missed Tax Deductions: Unrecorded expenses can lead to higher taxable income and missed tax savings.
• Cash Flow Issues: Unreconciled bank accounts and outstanding invoices can cause cash flow discrepancies.
• ATO Penalties: Late BAS lodgements and tax returns can result in hefty fines and interest charges.
• Poor Financial Decisions: Incomplete records make it difficult to assess business performance and plan for growth.

How to Catch Up on Bookkeeping – Step-by-Step

If you’re behind on bookkeeping, follow these steps to bring your financial records up to date:

• 1. Gather Financial Documents: Collect all bank statements, invoices, receipts, and payroll records for the period you’re behind on.
• 2. Reconcile Bank Accounts: Match each bank transaction to its corresponding entry in your accounting software to ensure all income and expenses are recorded accurately.
• 3. Review Accounts Payable: Identify outstanding bills and payments due. Record any missing invoices and schedule payments to avoid late fees.
• 4. Update Accounts Receivable: Follow up on unpaid invoices, record payments received, and write off bad debts if necessary.
• 5. Track Business Expenses: Ensure all business-related expenses are recorded and categorised correctly to maximise tax deductions.
• 6. Reconcile Payroll Records: Verify that employee wages, superannuation contributions, and tax withholdings are accurately reported.
• 7. Adjust for Missing Transactions: Review bank statements for any missing or unrecorded transactions, such as interest income or bank fees.
• 8. Generate Financial Reports: Run key financial reports, including profit and loss, balance sheet, and cash flow statements to assess business performance.

Common Bookkeeping Mistakes to Avoid

When catching up on overdue bookkeeping, avoid these common pitfalls:

• Mixing Personal and Business Expenses: Keep personal expenses separate to avoid tax issues and maintain accurate records.
• Ignoring Small Transactions: Even minor expenses can add up, so record every transaction, no matter how small.
• Failing to Track Cash Payments: Cash transactions should be recorded promptly to prevent discrepancies.
• Overlooking Payroll Liabilities: Ensure employee wages, tax withholdings, and superannuation are accurately reported and reconciled.

How to Stay Organised After Catching Up

Once your books are up to date, implement these strategies to stay organised and avoid falling behind again:

• Schedule Regular Bookkeeping Sessions: Set aside time weekly or monthly to update records and reconcile accounts.
• Automate Data Entry: Use accounting software to automatically import bank transactions and categorise expenses.
• Set Up Invoice Reminders: Automate invoice reminders to follow up on outstanding payments and maintain cash flow.
• Outsource to a Bookkeeper: Consider hiring a bookkeeper to manage ongoing financial records, BAS lodgements, and payroll processing.

How We Can Help

At Northern Beaches Bookkeeping Solutions, we specialise in catch-up bookkeeping services for small businesses. Whether you’re behind on BAS lodgements, payroll, or bank reconciliations, our experienced bookkeepers can help you get your books back in order and maintain accurate financial records moving forward. Contact us today to learn more about our bookkeeping solutions.

End of Year Tax Checklist – Prepare Your Small Business for Tax Time

The end of the financial year is a critical time for small businesses to review financial records, organise expenses, and prepare for tax lodgement. Completing key bookkeeping tasks before 30 June ensures that your business is ready for tax time and maximises eligible deductions. Here’s your comprehensive end-of-year tax checklist to stay on track and avoid ATO penalties.

Why Is End-of-Year Tax Preparation Important?

Preparing for the end of the financial year allows you to:

• Identify tax deductions and credits
• Review outstanding invoices and payments
• Ensure accurate financial records for tax lodgement
• Avoid ATO penalties for late or incorrect lodgements
• Assess cash flow and financial health

End of Year Tax Checklist for Small Businesses

Follow these essential steps to get your business ready for tax time:

• 1. Reconcile Bank Accounts: Match bank statements to accounting records and resolve discrepancies. This ensures that all transactions are accurately recorded.
• 2. Review Accounts Receivable: Follow up on unpaid invoices, write off bad debts, and record any payments received after 30 June.
• 3. Update Accounts Payable: Verify that all bills and expenses are recorded, and ensure that payments made after 30 June are accounted for in the next financial year.
• 4. Inventory Stocktake: Conduct a physical stocktake to assess inventory levels, write off obsolete stock, and adjust records accordingly.
• 5. Review Asset Register: Record any asset purchases, disposals, or depreciation for the financial year. Ensure that asset records are accurate and up to date.
• 6. Calculate Employee Superannuation: Ensure that all superannuation contributions are paid by 30 June to claim a tax deduction for the financial year.
• 7. Reconcile Payroll Records: Verify employee wages, tax withholdings, and super contributions to ensure they align with payroll reports and ATO records.
• 8. Identify Tax Deductions: Review expenses to identify potential tax deductions, including business travel, vehicle expenses, and office supplies.
• 9. Lodge Final STP Report: Submit the final Single Touch Payroll (STP) report for the financial year to the ATO to finalise employee income statements.
• 10. Back Up Financial Records: Ensure that all financial records, including bank statements, invoices, and payroll reports, are securely backed up and accessible for ATO review.

Tax Deductible Expenses to Review

Before lodging your tax return, review business expenses to maximise deductions. Common deductible expenses include:

• Office supplies and stationery
• Business-related travel expenses
• Vehicle expenses for business use
• Employee wages and superannuation
• Depreciation of assets (e.g., computers, equipment)
• Business insurance premiums
• Software subscriptions and IT expenses

Tax Planning Strategies for Small Businesses

To minimise your tax liability, consider implementing these tax planning strategies before 30 June:

• Prepay Expenses: Pay for expenses like insurance or subscriptions in advance to claim deductions in the current financial year.
• Write Off Bad Debts: Identify and write off uncollectible debts to reduce taxable income.
• Contribute to Superannuation: Make additional super contributions for yourself and employees to reduce taxable income.
• Defer Income: If possible, delay invoicing until after 30 June to defer income to the next financial year.

Common End-of-Year Tax Mistakes to Avoid

To avoid ATO penalties and ensure a smooth tax lodgement process, watch out for these common mistakes:

• Failing to reconcile bank accounts and credit card statements
• Overlooking small expenses that are tax deductible
• Incorrectly categorising personal and business expenses
• Missing the deadline for paying superannuation contributions
• Neglecting to back up financial records and receipts

Need Help Preparing for Tax Time?

Managing tax obligations can be overwhelming, especially if your bookkeeping is not up to date. Northern Beaches Bookkeeping Solutions provides expert tax preparation and bookkeeping services to help you stay organised, maximise deductions, and lodge BAS and tax returns accurately. Contact us today to get started.