Debts of any sort are a burden. Whether it be personal, business, school, or in the form of a loan, debt can quickly go from manageable to out of control and stressful. For your business, getting behind on taxes, lodgements and debt repayment is probably not written into your business plan. In order to avoid letting debts get out of control, it’s important to understand the deadlines for lodgement obligations. It’s also important to have a plan in place in case you do get behind in your debts and lodgements. Here is some information to help you wade through the murky waters of the Australian Tax Office.
Here are some deadlines to keep in mind for the upcoming year. Since they are the norm for most businesses, quarterly reporting deadlines will be covered.
By now, your business and your Business Activity Statement (BAS) agent should have lodged your quarterly activity statement for the 4th quarter of 2014-15. That deadline was August 25th. The next obligations are your monthly activity statement for August and lodging the pay-as-you-go (PAYG) withholding payment summary annual report (if a registered agent helped prepare the report). These deadlines are fast approaching, so ensure you have these affairs in order and submitted by September 21st and September 30th respectively. October is a very busy month tax wise, with October 31st being the final date on which tax agents can be appointed to new clients. If this doesn’t happen, that client’s 2015 tax return may not be covered by the lodgement program you currently use. Combine that with Q1 quarterly statements coming up on October 28th, and the annual PAYG instalment notice coming due (if you use the rate method to calculate the instalment), and October becomes quite a serious month for tax purposes.
What to Do In Your Situation
Your business is in crunch time, but that doesn’t mean that you can simply let the bookkeeping slide. While it may be down to the wire, finishing your bookkeeping and submitting your BAS on time is simply the best way to conduct your business. Early BAS submission leaves you with two positives. One, you avoid penalties incurred through late fees; two, you have more time and money for your business.
The Australian Taxation Office appreciates that things may be difficult, but failure to submit your BAS is a mistake you can’t afford to make. The fees that are tacked onto the late BAS and lodgings mean that you have to put more cash aside to pay your new debt to the Australian Tax Office that could be better spent expanding your business. Simply put, paying on time is better than not.
One thing you may or may not have considered is online BAS submission. You can still submit through the mail, but the benefit of online submission is that you are able to see BAS’ from years past. Another bonus is that sometimes, through the online option, you are able to qualify for a two week extension depending on prior BAS submissions.
As mentioned earlier, sometimes things simply don’t work out, and you aren’t able to lodge anything tangible to the Australian Taxation Office. Maybe it’s been a tough quarter, or heaven forbid a tough year. The silver lining is that you are still able to submit your BAS, despite not having any activity on it, or nil. By submitting a nil BAS, you are showing the Australian Tax Office that you are aware of your obligations and are doing your best to meet them.
However, even if you supply your BAS, you still owe tax, and therefore must enter into a payment schedule with the Australian Taxation Office. By calling them on time (ideally before the deadlines to pay) you may be able to avoid additional charges and fees. If you do default on the schedule provided by the Australian Tax Office, you will face much stiffer requirements, such as payment in full of the required amount owed. The lesson here is to stay on top of your bookkeeping. This is something that Darcy Bookkeeping can help you with.
Darcy Bookkeeping has trained professionals that can ensure your BAS needs are fulfilled at tax time, in order to keep as much of your business’ hard-earned money out of the Australian Tax Office’s grasp as it can. Feel free to give contact us with any questions you may have regarding their BAS and tax services so we can help prevent you from falling behind on taxes.