Making a mistake on your Business Activity Statement (BAS) is difficult to adjust later on. This is why this guide will talk about the 5 common BAS mistakes people tend to make, along with useful tips on how to avoid these errors on your BAS. If you want to evade the hassle and stress altogether, you can simply hire a professional BAS agent to ensure a smooth-sailing process. 

Here are 5 common BAS mistakes that people make. Keep them in mind and use the tips mentioned below to avoid them.

• Lodging Your BAS with Incorrect Information

If you fail to keep your accounts up-to-date, be prepared for a very stressful BAS time. This pressure makes mistakes inevitable. If you do spot an error, you should own up to it and rectify it, that too in a timely manner.  

If this was genuine oversight, you might be asked to pay interest on the underpaid tax or receive credit if you overpaid. However, if the ATO thinks the mistake was a result of sheer carelessness and negligence of the law, you’ll be charged with penalty interest. 

How to Avoid

Get in touch with a professional to mitigate chances of error or use accounting software. If you wish to handle it yourself, make sure you have a detailed and up-to-date database of your finances to leave little to no room for error. 

• Missing Deadlines

You should be very vigilant about the BAS deadlines. Bear in mind that this isn’t optional, and you need to adhere to the dates. The ATO is finicky about late lodgments and will fine you around $180 for every month the BAS is late, for up to 5 months. 

How to Avoid

If you lodge the BAS yourself, note the following BAS deadlines, which are displayed on your business activity statement: 

Quarterly: 

• 28th of October for July, August and September
• 28th of February for October, November and December
• 28th of April for January, February and March
• 28th July for April, May and June 

Monthly:

• 21st of the month after the end of the taxable period (for example, 21st August for July monthly BAS)

Annual:

• If you aren’t required to lodge a tax return, the deadline is 28th February after an annual tax period 

Keep reminders and you’ll never again miss the BAS deadline. 

• Including Dollars and Cents 

People make the common mistake of including cents, decimal points, commas and symbols on their BAS. This can lead to errors, which will be difficult for you to fix and adjust later on. 

How to Avoid

The simple rule to avoiding errors is using whole dollar figures in your business activity statement. You can formulate cells in your excel spreadsheet to use just rounded figures so that these mistakes would be picked up automatically and brought to your notice before you lodge the BAS. 

• Classifying a GST-Free Sale as Taxable 

Taxable sales are sales where the GST is payable. Naturally, there are some goods and services that are GST-free and you should be aware of them. However, people incorrectly claim GST on expenses that are free of GST. The ATO will cross-check lodged income tax returns and the BAS to identify any discrepancy, so make sure your reporting is correct.

How to Avoid 

When drafting the BAS, you should ensure proper allocation of the expense, whether it is GST-inclusive or GST-exclusive. Box 1 on the BAS requires you to enter complete sales for the relevant period, and this should include all the amounts mentioned in box G2 and box G3. To avoid the mistake above, make sure you indicate your reporting method (whether inclusive of GST or exclusive of GST) with a tick box.

• Claiming GST Credits Where not Applicable 

Many people make the mistake of claiming GST on purchases where the supplier is not registered for GST and is therefore not charging any tax on its goods and services. You cannot claim GST on such an expense. 

How to Avoid 

Understand that all the reporting will be verified by the ATO, so avoid making any intentional/unintentional mistakes. While most suppliers are probably registered for GST, you should check their source invoice to ensure that it is a tax invoice with a GST component. 

Final Word 

Lodging your BAS can be a tedious process and it may take years of experience and practice before you become well-versed at creating error-free business activity statements. To avoid any of these common mistakes, you should work closely with your bookkeeper to ensure your BAS has the correct information in the correct places.