BAS and reporting
Overdue BAS
An overdue BAS is a Business Activity Statement that has not been lodged by its due date, which can lead to penalties, interest and further ATO action if left unresolved.
A BAS becomes overdue the day after its due date passes without it being lodged. The ATO monitors lodgment closely. A late statement may attract a failure to lodge penalty, and if there is an amount owing, the general interest charge can accrue daily on the unpaid balance. The longer the statement stays outstanding, the more difficult and expensive the situation tends to become.
The first step is to stop avoiding it. Gather your records, reconcile your accounts for the period and prepare the statement as accurately as you can. Lodge it as soon as possible. Lodging late is far better than not lodging at all, because the ATO may otherwise estimate your liability and issue a default assessment, which could be higher than what you actually owe.
If you cannot pay the amount due, lodge anyway and then contact the ATO about a payment plan. The ATO generally looks more favourably on businesses that come forward voluntarily. Penalties may be reduced or remitted in some cases where there are good reasons for the delay, such as illness or a natural disaster, although this is up to the ATO's discretion, and you should not assume it will be granted.
Multiple overdue statements are a serious sign. The ATO can contact you, issue reminders, make phone calls and, in persistent cases, take stronger action. For companies, unpaid amounts of some kinds, such as PAYG withholding and super, can lead to personal liability for directors through the director penalty regime. Do not let a backlog build up. Catch up on the oldest period first.
A registered tax agent or BAS agent can help prepare and lodge overdue statements, and may be able to negotiate with the ATO on your behalf. Many accounting software providers can also help you reconstruct a period from bank feeds. When doing a catch-up, keep notes on how you arrived at the figures, since the ATO may ask for supporting records, which you should have kept for five years.
Another common problem is GST credits being held up because a statement is outstanding. The ATO can withhold a refund until your returns are up to date. Staying current protects your cash flow as well as your compliance record. This is general information only, so confirm what applies to you with the ATO or a registered tax professional.
Worked example
Dana misses the 28 April due date for her March quarter BAS. On 15 May she realises, prepares the statement showing net GST of $2,750 payable, and lodges it that day. She cannot pay the full amount, so she calls the ATO and sets up a monthly payment plan. She may still face a failure to lodge penalty and the general interest charge on the $2,750 while it remains unpaid.
Practical tips
- Lodge as soon as you can, even if you cannot pay, and then ask about a payment plan.
- Start with the oldest overdue period when catching up on several statements.
- Ask a registered agent for help if you have a backlog, as they can prepare and negotiate on your behalf.