09/12/2025 • 9 min read
How to Lodge BAS if Using Cash Basis
How to Lodge BAS if Using Cash Basis
When lodging a Business Activity Statement (BAS) on a cash basis in Australia, you account for income and expenses only when the cash is actually received or paid. This means that your GST liabilities align with your cash flow, which can be beneficial for small businesses. To lodge your BAS on a cash basis, follow these steps: ensure your accounting system is set to cash basis, accurately record all cash transactions, calculate GST based on actual payments and receipts, and use the ATO’s online services or your accounting software to submit your BAS.
What is Cash Basis for BAS?
Cash basis accounting records income and expenses as they are physically received or paid, rather than when they are invoiced or billed. This method is particularly advantageous for businesses with fluctuating cash flows, as it matches GST liabilities with cash availability.
- GST Obligations: GST is payable only on payments received and claimable on payments made.
- Eligibility: Typically available for businesses with turnovers under $10 million.
How to Prepare BAS on a Cash Basis?
Step 1: Setup Accounting System to Cash Basis
Ensure your accounting software or ledger system is set to reflect cash basis accounting. This setting determines how transactions are recorded and reported for tax purposes.- Sales Receipts: Record when cash is received.
- Purchases: Record when payments are made to suppliers.
- GST Collected: From sales when cash is received.
- GST Paid: On purchases when cash is paid.
Step 4: Lodge BAS
You can lodge your BAS through the ATO’s online services or via compliant accounting software such as MyLedger. Ensure all data is double-checked for accuracy to prevent errors.How Does Using Cash Basis Affect Your BAS Reporting?
- Simplified Cash Flow: Aligns GST obligations with actual cash flow, reducing the risk of cash shortfalls.
- Record Keeping: Requires diligent tracking of cash receipts and payments.
Practical Example
Consider a small retail business with a turnover under $10 million. By using cash basis, they only account for GST on sales when customers pay, which is beneficial during periods when credit sales are high but cash inflow is low.ATO Guidelines
According to the Australian Taxation Office (ATO), businesses using cash basis must ensure their accounting systems accurately reflect cash transactions. Per ATO guidance, ensuring compliance with cash basis requirements is crucial to avoid penalties.Frequently Asked Questions
Q: Who can use cash basis for BAS?
A: Businesses with an annual turnover of less than $10 million are generally eligible to use cash basis for BAS.Q: How does cash basis affect GST reporting?
A: GST is reported and payable only on cash that is actually received, which can help manage cash flow better.Q: Can I switch from accrual to cash basis?
A: Yes, you can switch accounting methods, but it's important to adjust your records accordingly and notify the ATO.Q: What happens if I report incorrectly?
A: Incorrect BAS submissions could lead to penalties. It's advisable to consult with a professional accountant or use compliant software like MyLedger to ensure accuracy.Q: How does MyLedger assist with BAS lodging?
A: MyLedger automates transaction tracking and GST calculations, ensuring accurate and timely BAS lodgement.Conclusion and CTA
In conclusion, lodging BAS using a cash basis method provides significant advantages for small businesses by aligning GST obligations with actual cash inflows and outflows. This method requires meticulous record-keeping and accurate reporting to comply with ATO regulations.
Next Steps: For streamlined BAS preparation and lodgement, consider using Fedix's MyLedger platform. With automated transaction tracking and complete ATO integration, MyLedger ensures accurate and efficient BAS submissions. Learn more about how MyLedger can transform your BAS reporting process by visiting [Fedix's website](https://home.fedix.ai).