Accounting methods
Simpler BAS
Simpler BAS is a reduced reporting option for eligible small businesses, which report fewer GST labels, such as total sales, GST on sales and GST on purchases, instead of the full set.
Simpler BAS is a streamlined way for eligible small businesses to report GST. Instead of completing the full set of GST labels, such as separate capital and non-capital purchases and several other fields, a business using simpler BAS only reports three GST amounts: total sales (G1), GST on sales (1A) and GST on purchases (1B). The aim is to reduce the time and complexity of preparing the statement.
Eligibility is set by the ATO and includes a turnover limit and certain other conditions. Not every business qualifies, and some stay on the full BAS by choice. If you are eligible, the ATO may have already moved you to the simpler version. You can check the form you receive in online services, or ask your agent. Because thresholds can change, check the ATO website for the current criteria.
Simpler BAS changes what you report, not what you must do behind the scenes. You still need to charge GST correctly, hold tax invoices for credits, keep proper records and calculate the three labels accurately. You still need to code your transactions as capital or non-capital in your accounts, if that is relevant for income tax, even though you do not report that split on the BAS.
The simpler form can reduce mistakes because there are fewer fields to complete, but it also gives you less visibility from the form itself. Your accounting software GST report remains the best source for understanding your position. Keep working papers that show how each of the three amounts was built. If you use an agent, they will generally know whether you are on simpler BAS and prepare accordingly.
A business on simpler BAS may still have other sections on its statement, such as PAYG withholding at W1 and W2, or PAYG instalments, depending on its registrations. Only the GST part is simplified. Do not assume the whole statement becomes shorter. Review your form each period to see which labels appear.
Retain your records for five years. If your business grows beyond the eligibility limits, you will move to the full BAS and need to report additional labels. This is general information only, so confirm your eligibility with the ATO or a registered tax professional.
Worked example
Ella's small online shop qualifies for simpler BAS. For the quarter, she reports total sales at G1 of $44,000, GST on sales at 1A of $4,000 (44,000 divided by 11), and GST on purchases at 1B of $1,500. She does not report capital and non-capital purchases separately, but she still holds tax invoices for every credit she claims. Net GST payable is $2,500.
Practical tips
- Check your statement in online services to see whether you are already on simpler BAS.
- Keep full records and working papers even though fewer labels are reported.
- Remember only the GST section is simplified, so other sections like PAYG withholding still need to be completed.