Business owners, especially the ones who are sole traders must have a good understanding of the difference between Income Tax and Business Activity Statement or BAS. Both of them are required to be completed regularly and have their separate obligations. It might a bit tough for many people to understand the difference between BAS and Income Tax when it comes to income reporting obligations.
Although both of them will confound individuals and ask them to report on expenses and income, both have plenty of differences between them. One can get in touch with your professional BAS agent to gain some insights about Income Tax and BAS, which will help them make the right decision.
To know how exactly Income Tax and BAS are different from each other, can check the information provided below.
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When an individual has decided to lodge his/her income tax, they need to provide information on how much money they earned and expenses, which they can claim as a deduction. With this information, one can check how much tax they have to pay or paid. If he/she has paid more than they should have, the extra money will get refunded to them. But, if they did not pay up the required tax, he/she will receive a tax bill. There are three ways through which one can lodge their income tax. Look below.
When individuals have made their decision to lodge a BAS, they need to provide records on how much was paid during the purchases and the amount of GST they have collected through sales. He/she doesn’t have to submit a tax invoice for their business activity statement, but they need to carry them. It’s because the Australian Taxation Office might request to see them.
The BAS or business activity statement will also be utilized for other tax-related work. For such reasons, one needs to deliver additional information on their income, employees and business. Lodging the BAS is pretty simple and easy, as individuals have to do so through the online platform.
One can lodge your BAS through accounting software and ATO’s online portal. Individuals can also take the help of a certified BAS Tax Return Agent, and if he/she is a sole trader, you can use the myGov account to lodge their BAS with no issues.
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Whether an individual wants to lodge their income tax or BAS, taking the help of a professional tax consultant Perth will be the best idea. Tax consultants are the right people to turn to as they will help them make financial decisions towards all the tax-related problems. Apart from that, they will take the responsibility to prepare the tax returns, ensure you meet all the tax obligations and help with the estate planning. The tax consultants will also provide them with their assistance when it comes to doing legal research on tax problems.
BAS and Income Tax are important for business owners and sole traders. Individuals have to provide their expenses and income for both of them. But the only difference Income Tax and BAS have is within their GST. Before individuals take the step of lodging their BAS or income tax, it’s suggested that they speak with professional tax consultants. They will provide them with the information they need on such areas.