ANOTHER panic is expected as the February 4 deadline for the second quarterly BAS statement draws nearer, but much of the pain can be avoided.
ANOTHER panic is expected as the February 4 deadline for the second quarterly BAS statement draws nearer, but much of the pain can be avoided.
Only a two-week extension granted to tax agents, on top of the three-week extension GST-registered businesses were given, allowed most businesses to remit their first BASs on time.
The Australian Tax Office reported more than 96 per cent of businesses lodged by the due date – admittedly a better return than it received under the old tax system.
To make the process easier, the ATO is putting 2,000 officers into the field to help businesses meet their BAS requirements.
It is also trying to let businesses know there is an easier way to fill out the forms. Most of the first BAS forms were filled out using the Calculation method that proved confusing and complex.
Business owners can use the Derived from Accounts Method, that simply requires them to record the GST payable and the GST credits information from their cashbook and make some reasonable estimates to fill out the remainder of the form.
With this method the business just needs the tax invoices to back up its figures for the GST payable and GST credits.
Fallon Group partner Jim Loaring said the Accounts Method would be a better way to tackle the BAS form for a lot of small businesses.
“The business still has to keep proper records and accounts and its owner still has to understand the terminology. It’s not the best solution but it’s better than what has been available,” he said.
Small Business Development Corporation managing director George Etrelezis said the Accounts Method would cut the time required for the SBDC’s BAS workshops in half.
Mr Loaring said despite the time it would save filling out the form, the Accounts method still meant business owners had more work to do.
“They still have to prepare their BAS every three months plus meet their Pay As You Go and Instalment income Activity Statements (IAS),” he said.
Tax agents will again receive a two-week extension on the February 4 deadline, providing they complete up to 50 per cent of their client’s BASs by the due date.
Mr Loaring said most accountants would be pushing the job of preparing the BAS, the IAS and PAYG onto their clients.
“Otherwise the accountants wouldn’t be able to handle it. They’re helping out with the first couple of BASs and after that it’ll be mostly up to their clients,” he said.
“The IAS has been largely pushed onto accountants because of some business set ups can cause complexity in this area.
“It’s actually quite a simple calculation once you can determine what goes into instalment income.”
Mr Etrelezis said the February BAS would again put businesses under the pump.
“Nobody likes doing their books over Christmas and New Year,” Mr Etrelezis said.
“They say it will be easier the second time around but new businesses will be doing their BAS for the first time and there are others who haven’t finished their first BAS yet.”
Despite the furore caused by the GST’s introduction, some believe it may actually help breed better small businesses.
Mr Etrelezis said the new tax system’s introduction had to result in better bookkeeping.
“It’s making operators look at their businesses more often – at least once a quarter,” he said.
“Before that, business owners were only looking at their books probably once a year.
“Just because people are coming through the door and invoices are being written does not necessarily translate through to the bottom line.
“The businesses’ pricing could be wrong, it may be paying too much for some of its stock or there could be system slippage somewhere.
“There is no substitute for a good regular look at the books. A good business will always assess its performance more often than once a year.”
n Some businesses have not yet received refunds from their November BAS. This could be because the ATO does not have their account details. Affected businesses should phone 13 24 78.
Only a two-week extension granted to tax agents, on top of the three-week extension GST-registered businesses were given, allowed most businesses to remit their first BASs on time.
The Australian Tax Office reported more than 96 per cent of businesses lodged by the due date – admittedly a better return than it received under the old tax system.
To make the process easier, the ATO is putting 2,000 officers into the field to help businesses meet their BAS requirements.
It is also trying to let businesses know there is an easier way to fill out the forms. Most of the first BAS forms were filled out using the Calculation method that proved confusing and complex.
Business owners can use the Derived from Accounts Method, that simply requires them to record the GST payable and the GST credits information from their cashbook and make some reasonable estimates to fill out the remainder of the form.
With this method the business just needs the tax invoices to back up its figures for the GST payable and GST credits.
Fallon Group partner Jim Loaring said the Accounts Method would be a better way to tackle the BAS form for a lot of small businesses.
“The business still has to keep proper records and accounts and its owner still has to understand the terminology. It’s not the best solution but it’s better than what has been available,” he said.
Small Business Development Corporation managing director George Etrelezis said the Accounts Method would cut the time required for the SBDC’s BAS workshops in half.
Mr Loaring said despite the time it would save filling out the form, the Accounts method still meant business owners had more work to do.
“They still have to prepare their BAS every three months plus meet their Pay As You Go and Instalment income Activity Statements (IAS),” he said.
Tax agents will again receive a two-week extension on the February 4 deadline, providing they complete up to 50 per cent of their client’s BASs by the due date.
Mr Loaring said most accountants would be pushing the job of preparing the BAS, the IAS and PAYG onto their clients.
“Otherwise the accountants wouldn’t be able to handle it. They’re helping out with the first couple of BASs and after that it’ll be mostly up to their clients,” he said.
“The IAS has been largely pushed onto accountants because of some business set ups can cause complexity in this area.
“It’s actually quite a simple calculation once you can determine what goes into instalment income.”
Mr Etrelezis said the February BAS would again put businesses under the pump.
“Nobody likes doing their books over Christmas and New Year,” Mr Etrelezis said.
“They say it will be easier the second time around but new businesses will be doing their BAS for the first time and there are others who haven’t finished their first BAS yet.”
Despite the furore caused by the GST’s introduction, some believe it may actually help breed better small businesses.
Mr Etrelezis said the new tax system’s introduction had to result in better bookkeeping.
“It’s making operators look at their businesses more often – at least once a quarter,” he said.
“Before that, business owners were only looking at their books probably once a year.
“Just because people are coming through the door and invoices are being written does not necessarily translate through to the bottom line.
“The businesses’ pricing could be wrong, it may be paying too much for some of its stock or there could be system slippage somewhere.
“There is no substitute for a good regular look at the books. A good business will always assess its performance more often than once a year.”
n Some businesses have not yet received refunds from their November BAS. This could be because the ATO does not have their account details. Affected businesses should phone 13 24 78.
