Updated for the 2025–26 income year (tax returns lodged from 1 July 2026), with 2026–27 changes noted. Reviewed 19 October 2026.
Online accounting software makes preparing your Business Activity Statement (BAS) easier – but software only reports what's coded into it. These are the GST mistakes we see most often when reviewing small business BAS.
1. Accidental "double dipping" on vehicle or equipment finance
Under most hire purchase arrangements, the GST credit for the purchase price is generally claimed upfront on the BAS for the period you enter the agreement. Coding the monthly repayments with GST as well claims it twice. Check the finance contract and code repayments (principal and interest) correctly.
2. Incorrect tax codes in your chart of accounts
Have your accountant or a registered BAS agent set up default GST codes before you start. One wrong default code repeats the error on every transaction.
3. Claiming GST on every expense
Many costs have no GST: bank fees and interest, most government charges (ASIC fees, council rates, vehicle registration), stamp duty, wages and super, and purchases from suppliers not registered for GST. Overseas purchases vary – some overseas digital suppliers charge GST, many don't. Always check the tax invoice.
4. Charging or reporting GST on GST-free sales
Some supplies are GST-free, such as most basic food and many health and medical services. Make sure sales are coded correctly.
5. Putting wages and super in G11
Wages are reported at W1 (with tax withheld at W2), not as purchases. Super isn't included in W1 and has no GST.
6. Leaving out cash sales or purchases
All cash sales must be reported. The ATO data-matches extensively; businesses in building and construction, cleaning, courier, road freight, IT, security and some other services may also need to lodge a Taxable Payments Annual Report (TPAR) by 28 August. Equally, make sure genuine cash purchases with tax invoices are claimed.
7. Claiming GST credits on private purchases
Private spending, personal loans, drawings and director's fees don't give rise to GST credits. Apportion mixed-use items.
8. Capital purchases coded incorrectly
If you report full GST information, capital purchases go in G10 and non-capital purchases in G11. Many small businesses (GST turnover under $10 million) use Simpler BAS, reporting only G1 (total sales), 1A (GST on sales) and 1B (GST on purchases) – but the GST still needs to be coded correctly in your software.
9. Leaving capital sales out of G1
Selling a vehicle, trading one in, or selling equipment is a taxable sale that must be included in G1 (and GST reported at 1A if registered).
10. Claiming GST from suppliers who aren't registered
Check that the invoice is a tax invoice and look up the supplier's ABN on ABN Lookup. If a supplier doesn't quote an ABN, you may need to withhold 47% of the payment (no-ABN withholding), unless an exception applies – for example, the payment is $75 or less (excluding GST), or the supplier gives you a signed statement that they're not entitled to an ABN or are supplying as a private hobby.
Stay on top of BAS deadlines
Quarterly BAS are due 28 October, 28 February, 28 April and 28 July; monthly BAS by the 21st of the following month. Lodging online or through a registered agent may give extra time (except quarter 2). If BAS takes too much of your time, our BAS service and bookkeeping team can take it off your hands.
Frequently asked questions
What is the no-ABN withholding rate?
47% of the payment, if a supplier doesn't quote an ABN and no exception applies (for example, payments of $75 or less excluding GST).
When is my quarterly BAS due?
28 October, 28 February, 28 April and 28 July. Lodging through a registered agent may give you more time for some quarters.
Do bank fees include GST?
Generally no – bank fees and interest are input-taxed, so there's no GST credit.
What is Simpler BAS?
A reporting method for businesses with GST turnover under $10 million that only requires G1, 1A and 1B on the BAS.