How the Business Activity Statement Works for GST
How it works
Every GST-registered business in Australia must lodge a Business Activity Statement (BAS) — either quarterly or monthly — to report the GST collected on sales and the GST paid on business purchases. The difference between these two figures is your net GST position: if you collected more GST than you paid, you owe the ATO; if you paid more GST than you collected, the ATO owes you a refund.
The key BAS fields for GST are G1 (total sales including GST), 1A (GST on sales), and 1B (GST on purchases). Your net GST liability is simply 1A minus 1B. Most small businesses lodge quarterly, with due dates falling 28 days after each quarter ends. Businesses with annual turnover above $20 million must lodge monthly, on the 21st of the following month.
You also need to choose between cash basis and accrual basis accounting for GST. On cash basis, you report GST when money actually changes hands — when you receive payment from customers and when you pay suppliers. On accrual basis, you report GST when you issue or receive invoices, regardless of when the payment occurs. Businesses with GST turnover under $10 million can use either method. Cash basis is simpler and avoids paying GST before you've actually been paid, which is why most small businesses prefer it.
When to use this calculator
- You want to estimate your quarterly BAS GST figure before lodgement so there are no surprises
- You're checking whether you'll owe the ATO or receive a refund this period
- You need to set aside the right amount of cash for your upcoming GST payment
- You're comparing the impact of cash vs accrual accounting on your GST position for the period
- You're a new business owner preparing your first BAS and want to understand the G1, 1A, and 1B fields before you lodge
Key concepts
- G1 — Total sales
- The total of all your sales for the period, including any GST you charged. This includes taxable sales, GST-free sales, and input-taxed sales. If you sold $55,000 worth of goods and services (including $5,000 GST), G1 is $55,000.
- 1A — GST on sales
- The total GST you collected from customers during the period. This is the GST component of your taxable sales only — GST-free and input-taxed sales contribute $0 to this field. This is the amount you owe to the ATO before credits.
- 1B — GST on purchases
- The total GST you paid on business purchases during the period for which you can claim input tax credits. This reduces the GST you owe. If 1B is larger than 1A, the ATO owes you the difference as a refund.
- Cash vs accrual basis
- Cash basis reports GST when money moves — you report a sale when the customer pays, and a purchase when you pay the supplier. Accrual basis reports GST when invoices are issued. The practical difference: on cash basis, a $5,500 invoice sent in March but paid in April appears on the April quarter BAS. On accrual, it appears in the March quarter even though the money hasn't arrived yet.
Worked example — Quarterly BAS for a graphic design freelancer
Mia is a freelance graphic designer (GST-registered, cash basis, quarterly lodging). Here are her figures for Q2 (October–December):
Sales received during the quarter:
| Client | Invoice amount (inc-GST) | GST component |
|---|---|---|
| Agency A | $5,500.00 | $500.00 |
| Direct client B | $3,300.00 | $300.00 |
| Agency C | $8,800.00 | $800.00 |
| Total sales (G1) | $17,600.00 | $1,600.00 (1A) |
Business purchases paid during the quarter:
| Expense | Amount (inc-GST) | GST component |
|---|---|---|
| Adobe Creative Cloud | $879.12 | $79.92 |
| New monitor | $1,100.00 | $100.00 |
| Co-working space | $1,320.00 | $120.00 |
| Office supplies | $165.00 | $15.00 |
| Total purchases | $3,464.12 | $314.92 (1B) |
BAS result:
| Field | Amount |
|---|---|
| 1A — GST on sales | $1,600.00 |
| 1B — GST on purchases | $314.92 |
| Net GST payable | $1,285.08 |
Mia owes the ATO $1,285.08 for the quarter. Her BAS is due by 28 February. Because she uses cash basis, an $11,000 invoice she sent in December but won't be paid until January doesn't appear on this BAS — it'll show up in Q3.