What is a Business Activity Statement (BAS)?

By Jen Bacquiano · 2 October 2014 · Updated 16 March 2026

A Business Activity Statement (BAS) is a form submitted to the Australian Taxation Office (ATO) to report and pay your business tax obligations, including Goods and Services Tax (GST), Pay As You Go (PAYG) withholding, PAYG instalments, and Fringe Benefits Tax (FBT) instalments. Most small businesses lodge BAS quarterly, with the next deadline being 28 April 2026 for the January-March quarter

If your business is registered for GST - which is mandatory once your turnover reaches $75,000 per year (or $150,000 for non-profits) - you need to lodge a BAS. Even if you had no activity during the period, you still lodge a nil BAS. Missing a lodgement triggers penalties regardless of whether you owe money

What does a BAS actually report?

Your BAS combines several tax obligations into a single form. Not every business reports on all of them, but here's what can appear

GST - the difference between the GST you've collected on sales (1A) and the GST you've paid on business purchases (1B). If you collected more than you paid, you owe the ATO. If you paid more than you collected, you get a refund
PAYG withholding - the tax you've withheld from employee wages, director fees, or contractor payments where no ABN was quoted. Reported at labels W1 and W2 on the BAS. This should reconcile with your payroll reports in Xero
PAYG instalments - pre-payments toward your own income tax liability. The ATO calculates these based on your most recent tax return. You can pay a fixed amount (T7) or use the instalment rate method (T2/T8)
FBT instalments - quarterly payments if your business provides fringe benefits like cars, parking, or entertainment to employees
Fuel tax credits - claimed by businesses that use fuel in eligible vehicles, machinery, or equipment

The combination of these items determines whether you owe the ATO money for the period or are due a refund

How often do you lodge BAS?

The frequency depends on your GST turnover and withholding obligations

Quarterly - most small businesses with GST turnover under $20 million. Due on the 28th of the month following the quarter end (except Q2, which is 28 February)
Monthly - required if GST turnover is $20 million or more, or if you choose to report monthly (common for businesses regularly in a GST refund position). Due on the 21st of the following month
Annually - available for businesses with GST turnover under $75,000 who voluntarily registered for GST

A registered BAS agent gets an additional four weeks for quarterly lodgement on most quarters, which is one of the practical reasons businesses use a BAS agent rather than self-lodging. For a full list of every deadline this financial year, see our 2025-26 BAS due dates

How to lodge your BAS

There are three ways to lodge

Through your accounting software - Xero connects directly to the ATO and can lodge your BAS electronically. Once your books are reconciled and your activity statement is reviewed, your BAS agent approves and lodges in a few clicks. This is how we lodge for every client
Through the ATO Business Portal - you can lodge directly via your myGovID. Suitable for simple BAS with straightforward GST and no payroll
Through a registered BAS agent or tax agent - they prepare, review, and lodge on your behalf. You get the agent lodgement concession (extra time) and safe harbour protection if errors occur

Paper lodgement is still technically available but the ATO is phasing it out. If you're still lodging on paper, the deadlines are earlier and there's no agent concession

Common BAS mistakes we see in Xero

After reviewing hundreds of BAS across client files, the same issues come up repeatedly

Private expenses coded with GST - personal purchases run through the business account and claimed as GST credits. This is the single most common ATO audit trigger we flag during pre-lodgement reviews
Unreconciled transactions - bank feed items left unmatched at quarter end. If a transaction isn't coded, it's not on your BAS. You're either understating income or missing GST credits
Incorrect GST treatment on mixed supplies - some services are GST-free (most health services, education, financial supplies). Coding everything as GST-inclusive when some items should be GST-free inflates your GST liability
PAYG withholding doesn't reconcile with payroll - the W1/W2 figures on your BAS should match your payroll reports for the same period. A mismatch is one of the first things the ATO checks

If any of these sound familiar, a BAS reconciliation before lodgement catches them before the ATO does

What happens if you lodge BAS late

The ATO imposes a failure-to-lodge penalty of one penalty unit ($330) per 28-day period overdue, up to five penalty units. For medium businesses ($1-20M turnover), the penalty doubles. On top of that, General Interest Charge (GIC) accrues daily on any unpaid amount at 11.17%. From 1 July 2025, GIC is no longer tax-deductible, which makes late payment significantly more expensive than it used to be

You're still required to lodge even if you can't pay the full amount. Lodging on time and setting up a payment plan is always better than not lodging at all. The penalty for non-lodgement stacks on top of the interest on unpaid tax

Do you need a BAS agent?

Legally, anyone can prepare and lodge their own BAS. But if someone else is doing it for you - whether that's a bookkeeper, accountant, or outsourced provider - they must be a registered BAS agent with the Tax Practitioners Board. This isn't optional. It's a legal requirement under the Tax Agent Services Act

Using a registered BAS agent gives you three things beyond the legal compliance: extended lodgement deadlines, safe harbour protection if the agent makes an error, and the peace of mind that someone with professional indemnity insurance is signing off on your numbers

At Digit, BAS preparation and lodgement is part of our managed bookkeeping service. Your books are reconciled throughout the quarter so the BAS is ready before the deadline, not scrambled together the night before

BAS lodgement deadlines and penalty rates referenced in this article are sourced from the Australian Taxation Office, current as at March 2026

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Jen Bacquiano

Jen has twelve years of Australian bookkeeping experience, a CPA, and a BAS Agent registration. She's also a Swiftie who speaks three Filipino dialects

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Common questions

A Business Activity Statement (BAS) is a form lodged with the Australian Taxation Office to report and pay GST, PAYG withholding, PAYG instalments, and FBT instalments. Most small businesses lodge quarterly, with payment and lodgement due on the 28th of the month following the quarter end.

Any business registered for GST must lodge a BAS. GST registration is mandatory when your annual turnover reaches $75,000 ($150,000 for non-profits). You must lodge even if you had no business activity during the period - this is called a nil BAS.

Most Australian small businesses lodge BAS quarterly. Monthly lodgement is required for businesses with GST turnover of $20 million or more. Annual lodgement is available for businesses under $75,000 turnover that voluntarily registered for GST.

The ATO charges a failure-to-lodge penalty of $330 per 28-day period overdue, up to a maximum of $1,650 for small businesses or $3,300 for medium businesses ($1-20M turnover). General Interest Charge at 11.17% also accrues daily on any unpaid amount, and GIC is no longer tax-deductible from 1 July 2025.

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