Opening a new restaurant or cafe? Then you need to understand your business tax and reporting obligations.
BAS stands for Business Activity Statement. Business owners such as restaurateurs must submit this form to the ATO (Australian Taxation Office) to report their GST (Goods & Services Tax) and PAYG (Pay As You Go / wages) taxation obligations.
The BAS can be submitted monthly or quarterly through the Internet, through a registered tax or BAS agent, by mail or by phone. Taxes are paid electronically, by mail or in person at Australia Post. Small businesses have the option of using Simpler BAS to save time.
GST stands for Goods and Services Tax. It’s a broad-based tax of 10% on most goods, services and other products sold or consumed in Australia. How is GST related to BAS? Through BAS, you report and pay GST or claim GST credits.
If you have just started a restaurant, and you expect your food business to earn $75,000 or more in its first year of operation, it’s your responsibility to register for GST.
When you sell products from your restaurant, you will charge your customers 10% tax on some of your goods. Not all food items attract 10% GST, so check with your BAS agent, bookkeeper or accountant which ones apply. Incorrectly charging and reporting GST is an offence – so take the time to check.
At monthly or quarterly intervals, you or your bookkeeper will complete the reports and pay the collected GST to the ATO, less any GST you paid to your suppliers.
Any PAYG taxes that you have deducted from employee’s wages will also be reported and paid at BAS time.
It’s a simple equation of tax in and tax out.
For more information and assistance, call Restaurant Bookkeepers Australia 1300 043 327 or check out the ATO website.