A new way to do BAS is coming, but will it make your life easier or actually save you any time?
From 1 July 2017, the ATO is making changes to the way small business does BAS, by reducing the amount of GST information required for BAS.
The changes are aimed at making it easier for your bookkeeper, or for you, to classify transactions in your bookkeeping software.
The changes mean you will only need to report:
- GST on sales (1A)
- GST on purchases (1B)
- Total sales (G1)
You’ll no longer be required to report on non-capital purchases (G11), capital purchases (G10), other GST free sales (G3) and export sales (G2).
And you’ll only have to report on two tax codes only: GST sales and no GST.
Will this save time?
While we applaud any changes that make BAS and reporting simpler, we don’t see this new system saving you tonnes of time.
Keeping full and correct records for your business is still important – especially for tax time. You’ll still need to know which purchases were capital and which were non-capital for income tax purposes and for an accurate reflection of your business’s cashflow.
You, or your bookkeeper, will still need to do thorough checks and balances and go through the process of working out if GST applies.
Although this has been billed as the biggest change to BAS since the introduction of the GST, we see this as a small tweak as a process helper, but not a total life changer. It is of course, a welcome step towards reducing small business red tape.
The start of the 2017/18 financial year is shaping up to be a big one with lots of changes including this one and the upcoming super reforms. Make sure you’re prepared – book a chat with us.
To find out more about the BAS changes, visit the ATO website.