From 1 July 2017, Simpler BAS is the default reporting method for small businesses with a GST turnover of less than $10 million. If you are a small business, you will now have less GST information required to be reported on your BAS.
The Simpler BAS will only require you to report:
- G1 Total sales
- 1A GST on sales
- 1B GST on purchases
The following GST information is no longer required:
- G2 Export sales
- G3 GST-free sales
- G10 Capital purchases
- G11 Non-capital purchases
What do you need to do?
If you are eligible, you don’t need to do anything as the ATO will automatically transition you. However, if your estimated annual GST turnover is $10 million or more, you will still be required to use the full reporting method.
- Online lodger:You don’t need to do anything to set up for Simpler BAS reporting. The ATO will automatically send you a BAS with requesting less information.
- Paper lodger:You only need to complete Total sales (G1), GST on sales (1A) and GST on purchases (1B).
If your software is cloud based, there will be an update to enable Simpler BAS. There is nothing you need to do.
So, is it really much simpler?
If you lodge your own BAS or do your own bookkeeping, then yes, you will no longer have to determine between GST on Purchases and GST Capital purchases, etc. The GST categories will be simplified. However, you will still need to determine if a purchase has a GST-free component and separate these as per the tax invoice. The difference is, you will no longer have to report the GST-free portion of your purchases and sales on the BAS lodged to the ATO. Essentially, correct GST and account allocation will still be required. You will still need to keep records, such as tax invoices, as proof of any claims you make in your BAS and income tax return lodgements. To be honest, you may not notice a lot of change as the bookkeeping in your file remains the same.
Simpler BAS does not affect how other taxes are reported (e.g. PAYG income tax instalments or PAYG tax withheld), or how often you lodge your BAS. If you report annually now, you will continue to report annually after 1 July 2017.
If you learn better by watching, following is a link to the ATO video about Simpler BAS.
Still have questions or need a hand? Let us help you, contact us on 07 5528 2000