au-bas-preparation

Files (1)

• SKILL.md

SKILL.md (first lines)

# Australia BAS Preparation

## Australia BAS Preparation v0.3

> **General reference only.** This skill is general tax and accounting reference material for
> AI-assisted workflows. It has not been reviewed for any specific person's facts, documents,
> elections, deadlines, residency, filing status or local procedures. Do not rely on it to
> lodge, pay, amend or take a tax position without review by a qualified professional.

## What this file is

**Obligation category:** CT (consumption tax), WHT (withholding tax), ET (estimated tax)
**Functional role:** Preparation workflow, spanning every role reported on one activity statement
**Status:** Source-cited draft, pending accountant review

This is the end-to-end preparation workflow. It sequences the work and tells you which guide owns
each rule. It does not restate the classification rules:

- GST classification of sales and purchases, the supplier pattern library and the refusal
  catalogue live in `australia-gst.md`.
- Label-level PAYG withholding, PAYG instalment and FBT instalment mechanics live in
  `au-gst-bas.md`.
- Property transactions, including the margin scheme and GST at settlement, live in
  `au-gst-property.md`.
- Lodgment dates, penalties, interest and remission live in `au-lodgment-deadlines-penalties.md`.

## Section 1 - Scope statement

This skill covers:

- The preparation sequence for a business activity statement, from source records to lodgment.
- Reconciling the GST and PAYG withholding control accounts to the ledger before any label is
  filled in.
- Choosing between Simpler BAS and full reporting, and between cash and non-cash (accruals)
  accounting for GST.
- Mapping ledger balances to the GST labels (G1, 1A, 1B), the PAYG withholding labels
  (W1 to W5, label 4), the PAYG instalment labels (T1 to T9, 5A, 5B) and the summary
  (8A, 8B, 9).
- Distinguishing PAYG withholding from PAYG instalments, which are different obligations that
  share one form.
- Adjustments, corrections of earlier errors, and when a revision is required instead.
- The lodgment and payment step, including the electronic lodgment concession.

This skill does NOT cover:

- Whether a particular supply is taxable, GST-free or input taxed. See `australia-gst.md`.
- Registration, cancellation or turnover tests. See `australia-gst.md`.
- Payroll calculation, award interpretation, superannuation guarantee or Single Touch Payroll
  reporting. See `australia-payroll.md` and `au-super-guarantee.md`.
- Fuel tax credits, wine equalisation tax and luxury car tax computation. Those labels appear on
  the BAS but their rules are outside this file.
- Income tax return preparation. PAYG instalments are prepayments only, and the return is where
  they are reconciled.

## Section 2 - Establish the facts before you calculate

**Facts to establish before calculating**

| Fact to establish | Why it changes the answer |
| --- | --- |
| Entity and ABN | Determines who lodges and which roles are registered |
| GST registration status and date of effect | An unregistered period has no GST labels at all |
| Reporting cycle: monthly, quarterly or annual | Sets the period and the due date |
| Simpler BAS or full reporting | Simpler BAS reports only G1, 1A and 1B for GST |
| Accounting basis: cash or non-cash (accruals) | Sets the period an amount is attributed to |
| Whether G1 is reported GST-inclusive or GST-exclusive | The BAS requires the choice to be indicated |
| PAYG withholding registration and withholder size | Determines the W labels and the payment cycle |
| PAYG instalment role, and option 1 or option 2 | Determines whether T7 or T1 and T2 are used |
| FBT instalment role | Determines whether F1 applies |
| Any prior period error not yet corrected | Determines whether a correction or a revision is needed |

- **GST reporting cycle** — Quarterly applies where GST turnover is less than $20 million and the ATO has not directed monthly reporting. Monthly is compulsory at $20 million or more, and is available by choice below that. Annual reporting is available only to an entity that is voluntarily registered, that is, turnover under $75,000, or under $150,000 for a not-for-profit body.  _([ATO, Due dates for lodging and paying your BAS](https://www.ato.gov.au/businesses-and-organisations/preparing-lodging-and-paying/business-activity-statements-bas/due-dates-for-lodging-and-paying-your-bas))_
- **Accounting basis** — On a cash basis, an amount is attributed to the period in which payment was received or made, and may be part of the sale price. On a non-cash (accruals) basis, an amount is attributed to the earlier of the period in which any payment is received or made and the period in which an invoice is issued or received.  _([ATO, Identify your accounting basis; GST Act ss 29-5, 29-10](https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/in-detail/managing-gst-in-your-business/reporting-paying-and-activity-statements/completing-your-bas-for-gst/identify-your-accounting-basis))_

**Do not assume the basis from the accounting file.** A file set to accrual reporting for management accounts can still be registered to report GST on a cash basis, and the reverse is common after a change of adviser. Confirm the registered basis, not the software setting.

## Section 3 - Step 1: Gather the records

Collect, for the exact period being reported:

1. The trial balance and general ledger for the period, after the period is closed to new entries.
2. Bank statements for every business account, including credit cards and loan accounts, covering
   the full period.
3. Sales records: invoices issued, point-of-sale summaries, platform settlement reports.
4. Purchase records: tax invoices for acquisitions where a credit will be claimed.
5. Payroll records for the period: the payroll register and the Single Touch Payroll year-to-date
   figures at the period end.
6. Any ATO correspondence for the period, including the pre-filled instalment amount or rate.
7. Any adjustment notes issued or received, and any credit notes.
8. Records of assets bought or sold, including trade-ins.

- **Evidence rule for credits** — A GST credit generally requires a valid tax invoice held at the time the claim is made. The exception applies to acquisitions of $82.50 including GST or less. The four-year credit time limit is not permission to claim before the required evidence exists.  _([GST Act ss 11-5, 29-10, 29-70, 93-5](https://www.ato.gov.au/law/view/document?docid=PAC/19990055/29-10))_

### 3.1 Invoice population and evidence register

An invoice sample supports conclusions about the documents inspected. It does not establish that
the purchase population is complete or that the BAS credit total is correct. Record the entity,
period, registered GST basis, export time, report filters, row count and GST control totals. Bridge
the purchase listing to the GST transaction report and ledger, including credit notes, journals,
cash transactions, duplicates and excluded items. Explain timing differences rather than forcing
the totals to agree. If only a sample was supplied, state the selection method and coverage and
leave the population reconciliation unperformed.

Keep one row per exception:

| Document / transaction | Check performed and evidence | Result | Missing fact / amount affected | Owner and next action | Status |
| --- | --- | --- | --- | --- | --- |
| Invoice or RCTI reference | Source file, issue date, GST registration evidence and reconciliation reference | Supported / exception / not checked | Identify the affected claim without guessing its treatment | Named reviewer and requested evidence | Open / resolved with evidence |

Apply these Australian invoice controls before treating an affected credit as supported:

- **RCTIs:** check eligibility and all applicable requirements in the 2023 determination, not just
  the presence of the words 'recipient created'. Both supplier and recipient must be GST registered
  when the RCTI is issued. The eligible recipient category matters; an 'other business entity' must
  determine the value of the supply. Check the current agreement, specified supplies, registration
  acknowledgements and cessation notifications. A compliant agreement may be separate or embedded
  in the RCTI under its distinct requirements. Retain dated evidence of the checks as a preparation
  control. The ATO expects supplier registration checks before the first RCTI and periodically
  thereafter; automated checking at issue is best practice.

From openaccountants/openaccountants, AGPL-3.0.

More from openaccountants/openaccountants