Tax compliance · Small business
GST and BAS: when to register, what to lodge and when
A short, accurate read on Australian GST registration thresholds, BAS lodgement cycles, the three GST treatment classes and the practical due dates that catch sole traders out. Sources cited per section.
★Key takeaways
- ✓GST registration is mandatory at $75,000 annual turnover for businesses ($150,000 for NFPs). Taxi, rideshare and limousine services must register from the first dollar of revenue.
- ✓Most small businesses lodge BAS quarterly. Lodging through a registered BAS or tax agent buys an automatic 4-week extension per quarter.
- ✓Three GST treatments: taxable (10% added, seller claims input credits), GST-free (no GST added, seller still claims credits), input-taxed (no GST added, seller cannot claim credits on inputs).
- ✓Cash-basis GST reporting is available under $10m turnover and is usually better for cash-flow. Accruals basis is mandatory above that.
- ✓Penalties for late lodgement compound. If you cannot pay on time, lodge anyway and call the ATO to negotiate a payment plan – the FTL penalty is the punishment for not lodging, not for not paying.
Registration
When GST registration is mandatory
Standard threshold
$75,000
annual GST turnover, businesses
NFP threshold
$150,000
not-for-profit organisations
Taxi + rideshare
$1
from the first dollar of fares
The 21-day rule: once your projected GST turnover for the current month plus the next 11 months reaches the threshold, you have 21 days to register. Backdating is mandatory if you didn’t register on time, and the ATO can recover GST on past sales (even if you didn’t collect it).
Voluntary registration is allowed below the threshold. It lets you claim GST credits on your business inputs but obliges you to charge GST on sales (10% added to your prices). For B2B businesses, voluntary registration usually pays off because your customers claim back the GST anyway. For B2C businesses below the threshold, voluntary registration usually costs you 10% margin without any offsetting benefit.
Source: ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/registering-for-gst
Three GST classes
Taxable, GST-free, input-taxed
Every sale falls into one of these three. Knowing which one applies controls what you charge, what you claim and what shows up on your BAS.
| Class | GST on sales | Claim GST credits on inputs? | Common examples |
|---|---|---|---|
| Taxable | 10% added | Yes | Most goods and services, professional fees, retail, manufacturing |
| GST-free | Not added | Yes (on inputs related to GST-free sales) | Basic food, most health and medical services, education, exports, childcare |
| Input-taxed | Not added | No | Residential rent, most financial supplies (loans, share trading, insurance underwriting) |
Source: A New Tax System (Goods and Services Tax) Act 1999. Practical guidance at ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst.
BAS lodgement cycles
Monthly, quarterly or annual
Most small businesses
Quarterly
Default for GST turnover $75k–$20m. Four BAS per year. Due 28 days after quarter-end (28 Oct, 28 Feb, 28 Apr, 28 Jul). Lodging through a registered agent extends each due date by about 4 weeks.
$20m+ turnover, or elected
Monthly
Mandatory above $20m GST turnover. You can also elect into monthly if you regularly receive GST refunds, which speeds up the cash-flow cycle. Due 21st of the following month.
Voluntary registrants
Annual
Available if you’re voluntarily registered (turnover under $75k) and elect for annual reporting. BAS is lodged with your annual income tax return.
Due dates 2025-26
Quarterly BAS calendar
| Quarter | Period | Self-lodged due | With registered agent |
|---|---|---|---|
| Q1 | July – September | 28 October | 25 November |
| Q2 | October – December | 28 February | 28 February (no extension) |
| Q3 | January – March | 28 April | 26 May |
| Q4 | April – June | 28 July | 25 August |
Source: ato.gov.au – due dates. If a due date falls on a weekend or public holiday, lodgement is due the next business day.
Cash vs accruals
Which reporting basis to choose
Cash basis: GST is reported in the period money actually changes hands. You only remit GST you have collected. Available to businesses with GST turnover under $10 million.
Accruals basis: GST is reported on invoice date, regardless of payment. You can find yourself remitting GST on an invoice you haven’t been paid for. Mandatory above $10m turnover.
For sole traders and most small businesses, cash is the safer choice for cash flow. Switching basis requires the ATO’s agreement and you generally stay on the chosen basis once selected.
What a BAS actually contains
The labels on your BAS
- G1 – Total sales (GST-inclusive)
- 1A – GST on sales (the 10% you collected)
- 1B – GST on purchases (input credits)
- W1 – Gross wages (if you’re also reporting PAYG withholding)
- W2 – PAYG withheld from employees
- T7 – PAYG instalment for your own income tax
- 9 – Net amount payable to (or refundable from) the ATO
Xero, MYOB and QuickBooks all pre-populate these labels from your bookkeeping. The work is making sure the underlying coding is right, not retyping numbers.
Practical traps
Common BAS mistakes that trigger ATO contact
- Claiming GST on bank fees and interest – financial supplies are input-taxed, no GST credit available.
- Claiming GST on residential rent paid for staff accommodation – residential rent is input-taxed.
- Claiming GST on the entirety of a mixed personal/business expense – must apportion by business-use percentage.
- Forgetting GST on private-use of a business car (or business assets sold privately).
- Claiming GST without a valid tax invoice for purchases over $82.50 (GST-inclusive).
- Treating overseas supplier invoices as taxable – most are GST-free imports; GST is paid at the border via customs (or via the simplified GST scheme).
- Mixing PAYG withholding (W2) with PAYG instalment (T7) – they are separate. W2 is your employees’ tax; T7 is your own.
Common questions
GST + BAS – common questions
Do I have to register for GST?
You must register if your annual GST turnover is $75,000 or more ($150,000 for not-for-profits). Taxi, rideshare and limousine services must register from the first dollar of turnover. You can also register voluntarily below the threshold, which lets you claim GST credits on purchases but obliges you to charge GST on sales.
What counts toward the $75,000 turnover test?
GST turnover is your gross income from taxable and GST-free sales, projected over the current month plus the next 11 months (or the previous 12 months). It excludes input-taxed sales (e.g. residential rent), private sales, and the value of certain capital sales. Once you reasonably expect to exceed $75,000, you have 21 days to register.
What is the difference between GST-free and input-taxed sales?
GST-free sales (e.g. basic food, most health services, education) include no GST in the price, but the seller can still claim GST credits on inputs. Input-taxed sales (e.g. residential rent, financial supplies) also include no GST in the price, but the seller cannot claim GST credits on related inputs. Taxable sales include 10% GST and the seller claims input credits.
How often do I lodge a BAS?
Quarterly is the default for most small businesses ($75k–$20m turnover). Monthly is mandatory if your GST turnover is $20m or more, or you elect into it. Annual GST reporting is available if you are voluntarily registered (turnover under $75k) and elect for annual reporting; the BAS is lodged with your annual income tax return.
What are the BAS due dates?
Quarterly BAS due dates: Q1 (Jul-Sep) – 28 October; Q2 (Oct-Dec) – 28 February; Q3 (Jan-Mar) – 28 April; Q4 (Apr-Jun) – 28 July. Lodging through a registered BAS or tax agent buys an automatic extension of about 4 weeks per quarter. Monthly BAS is due on the 21st of the following month.
Should I use cash or accruals reporting?
Cash basis recognises GST when money actually changes hands. Allowed if your GST turnover is under $10 million. Better for cash-flow management because you only remit GST you have collected. Accruals reports GST on invoice date regardless of payment. Mandatory above $10m turnover. Once you choose, you generally stay on the same basis.
Can I claim GST on a car purchase?
You can claim GST credits on a business-use car up to the luxury car limit ($69,674 for 2024-25). Above that you cannot claim credits on the excess. The depreciation cost limit applies similarly for income tax. Private-use proportion must be excluded.
What happens if I lodge a BAS late?
Failure-to-lodge penalties accrue per 28-day period overdue: $313 for small entities (2025 unit), $1,565 for medium and $7,825 for large entities, plus general interest charge on any unpaid tax. The ATO will sometimes waive a first-time penalty if you have a clean history and contact them proactively.