A BAS is a one-page form that summarises three months of decisions. Every GST code chosen in Xero, every bank rule, every receipt that did or didn't turn up, ends up in a handful of boxes. The form takes minutes to lodge. Getting the numbers behind it right is the actual work.
GST is consistently one of the ATO's biggest compliance areas, and most errors we find aren't fraud or carelessness. They're small coding decisions, repeated every month, that nobody has checked. Here's how we prepare a BAS, what we look for, and what it costs.
What goes into a business activity statement?
Not every business reports every label. These are the ones most small businesses use.
| Label | What it reports | Common source of error |
|---|---|---|
| G1 | Total sales, including GST | Payment platform payouts recorded net; transfers counted as sales |
| G2, G3 | Export sales and other GST-free sales | GST-free items coded as taxable, or the reverse |
| G10, G11 | Capital purchases and other purchases | Assets coded as expenses; loan repayments included |
| 1A | GST on sales | Understated where sales are coded GST-free in error |
| 1B | GST on purchases (credits) | Credits claimed on wages, bank fees, insurance or private spending |
| W1, W2 | Total wages and PAYG withheld | Not matching the STP figures for the same period |
| T7 or 5A | PAYG instalment | Instalment not varied when profit has fallen or risen sharply |
| 7D | Fuel tax credits | Wrong rate period; light vehicles on public roads claimed |
How does our BAS process work?
- Books reconciled daily. Because your Xero file is current, BAS preparation starts from clean data. See our Xero bookkeeping service.
- Pre-lodgement check. Our BAS pre-lodgement check agent reads the period's transactions and compares account codes to GST codes, looks for credits claimed on items that never carry GST, checks large and unusual items, compares against previous periods, and flags anything that doesn't fit.
- Workpaper with every figure traced. The BAS workpaper is drafted with each label linked to the transactions that make it up, so the reviewer can click from 1B to the invoices behind it.
- Accountant review and sign-off. A qualified accountant reviews the flags, the workpaper and anything you've told us, and decides. The agent's output is a starting point, not a conclusion.
- You approve on your phone. We send you the figures and the amount payable or refundable, with a short note on anything that changed. You approve without logging in to anything.
- We lodge and remind you to pay. Lodged electronically, so the agent due date applies where eligible.
- Post-BAS review. After lodgement, our post-BAS review agent scans the numbers for movements worth asking about (a jump in costs, sales falling against last year, wages rising faster than revenue) and turns them into questions for your client manager to raise with you. This is where a compliance job starts to be useful for running the business.
All of this runs on Nagaris. AI agents draft and check; qualified accountants review and sign off, and nothing is lodged without a person approving it.
What GST traps do we check for?
These are the coding errors we find most often when we take over a new client's file.
| Transaction | Correct GST treatment | Common error |
|---|---|---|
| Wages and superannuation | Not reported on the BAS at all | Included in purchases, sometimes with GST credits claimed |
| Bank fees and interest | Input taxed: no GST credit | GST credit claimed |
| Insurance premiums | GST credit on the GST component only; none on stamp duty; none on life insurance | Full credit claimed on the whole premium |
| Client entertainment | Generally no GST credit (follows income tax) | Credit claimed on business lunches and events |
| Council rates and government fees | Generally no GST | GST credit claimed |
| Overseas software subscriptions | Depends whether the supplier charged Australian GST | Credit claimed without a valid tax invoice |
| Car purchase | Credit capped at the car limit share, and only for business use | Full credit claimed on a luxury or mixed-use car |
| Residential rent received | Input taxed: no GST on rent, no credits on related costs | Reported as taxable, or credits claimed on repairs |
| Commercial rent received | Taxable: GST charged on rent | Rent recorded with no GST |
| Prepared food and drinks (cafés, catering) | Generally taxable | Coded GST-free like basic food |
| Private use of business assets | Credit limited to business use | Full credit claimed |
| Loan repayments | Not on the BAS | Principal included in purchases |
What does a small coding error cost?
Example: a café codes $550 a month of bank account and loan fees as "GST on expenses" instead of "input taxed". That's a $50 credit claimed each month that shouldn't be, or $600 a year. Over four years, that's $2,400 of overclaimed GST credits, plus interest and possibly a penalty if the ATO finds it in a review. The fix in Xero takes thirty seconds. Finding it is the hard part, which is why we check the coding behind every label, not just the totals.
If any of these look familiar, it's worth having us review your last few BAS. Errors can usually be corrected in a later BAS within limits, or by revising the original. The ATO's guidance on fixing BAS mistakes sets out when each applies.
Should you lodge quarterly or monthly?
Most small businesses lodge quarterly. You must report GST monthly if your GST turnover is $20 million or more, and you can choose monthly at any turnover. The ATO can also move a business to monthly reporting if it has a history of not meeting its obligations.
| Situation | Usually better |
|---|---|
| Steady trading, GST payable each period | Quarterly: less admin, more time before paying |
| Regular GST refunds (exporters, heavy capital spending, start-up phase) | Monthly: refunds arrive sooner |
| Cash flow is tight and GST tends to get spent | Monthly: smaller bills, less temptation |
| Books are behind or unreliable | Quarterly until the books are fixed |
| Voluntarily registered with turnover under $75,000 | Consider annual GST reporting |
When is the BAS due?
For 2026–27, quarterly BAS lodged electronically through an agent have these due dates:
| Quarter | Standard due date | Agent due date |
|---|---|---|
| July–September 2026 | 28 October 2026 | 25 November 2026 |
| October–December 2026 | 28 February 2027 | 28 February 2027 (no extension) |
| January–March 2027 | 28 April 2027 | 26 May 2027 |
| April–June 2027 | 28 July 2027 | 25 August 2027 (ATO to confirm) |
Monthly BAS are due on the 21st of the following month. The December monthly BAS is due 21 February for businesses with turnover up to $10 million lodging electronically through an agent. Conditions apply to the agent dates: the previous statement must have been lodged electronically, and some statement types aren't eligible. Our guide to BAS due dates has the full detail, and our compliance calendar shows how BAS fits with everything else.
How do fuel tax credits work on the BAS?
Fuel tax credits give back some or all of the fuel tax in the price of fuel used in your business. They're claimed at label 7D, and you need to be registered for GST and for fuel tax credits.
The rules that catch people out:
- Rates change regularly, usually in February and August, and sometimes in between. The rate depends on when you acquired the fuel, so a quarter can span two rates.
- Heavy vehicles on public roads get the credit less the road user charge, which can bring the rate to nil.
- Light vehicles (4.5 tonnes GVM or less) on public roads aren't eligible.
- Off-road use, such as plant, machinery, generators and farm equipment, generally gets the full rate.
- Claims under $10,000 a year can use simplified record-keeping methods. Larger claims need detailed records of litres and dates.
Our fuel tax credits agent calculates the claim at the right rate for each period from your fuel records; an accountant checks the eligibility of each use before it goes on the BAS. This matters most for transport and logistics, construction, farming and mining clients.
What mistakes do we see with BAS?
- Lodging from unreconciled books. If the bank isn't reconciled, the BAS is a guess.
- W1 and W2 not matching payroll. The ATO sees your STP data. If your BAS says something different, expect a question.
- Never varying PAYG instalments. If profit has dropped, you may be paying far more than you need to during the year.
- Treating the GST collected as available cash. It isn't yours. Setting it aside each week stops the quarterly shock.
- Not lodging because you can't pay. Always lodge. Then talk to us about a payment plan.
- Correcting errors by editing old periods in Xero. Fix errors in the current period and keep the lodged BAS figures intact.
What does BAS lodgement cost?
BAS preparation and lodgement are included in all our fixed weekly plans, starting with Compliance Essentials from $149 per week + GST, which includes bookkeeping and BAS lodgements. If you have a bookkeeper and only want us to review and lodge, we'll quote a fixed fee per BAS. See our pricing page.
If you're not yet registered for GST and wondering whether you should be, start with our guide on when you need to register for GST.
What should you send us?
- Xero access (or your BAS reports and general ledger from other software)
- Your last two lodged BAS and any ATO activity statement letters
- Fuel records if you claim fuel tax credits: litres, dates, vehicles and use
- Details of any asset purchases or sales in the period
- Anything unusual: a large one-off sale, a property transaction, an overseas purchase
Frequently asked questions
What's the difference between a BAS agent and a tax agent?
Both are registered with the Tax Practitioners Board. A BAS agent can provide BAS services such as GST, PAYG withholding and payroll reporting. A tax agent can do all of that plus income tax returns and tax advice. BPAG is a registered tax agent, so one firm can handle your BAS and the tax return it feeds into.
Can I lodge my own BAS?
Yes, through ATO online services or directly from Xero. Many small businesses do, and if your books are clean and your GST is simple, it's a reasonable choice. You'll miss the agent's later due dates and the second set of eyes, which matter most when you have staff, mixed-use assets or GST-free sales.
How far back can I claim a GST credit I forgot?
Generally, your entitlement to a GST credit ends four years after the BAS in which you could first have claimed it. Within that period you can usually include it in a later BAS. Check the details with us before relying on this for large amounts.
What if I can't pay my BAS on time?
Lodge on time anyway. A late lodgement attracts its own penalty, and for companies an unlodged BAS can increase directors' personal exposure. Then contact the ATO about a payment plan before the due date. We can set that up for you.
Do I have to register for GST?
You must register once your GST turnover reaches $75,000 a year ($150,000 for non-profits), and taxi and ride-sourcing drivers must register regardless of turnover. Below that, registration is optional. Our guide to GST registration explains the trade-offs.
Should I account for GST on a cash or accrual basis?
Businesses with aggregated turnover under $10 million can generally choose cash basis, which means you report GST when you're paid and claim it when you pay. That suits most small businesses because you don't pay GST on invoices customers haven't paid yet. Accrual suits businesses that pay suppliers well before customers pay them.
Official sources
General information only, current as at 18 October 2026. It is not personal tax, legal or financial product advice and doesn't take your circumstances into account. Talk to us before you act. Where a recommendation needs a licensed financial adviser or a solicitor, we work alongside them.