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Lodge activity statements direct through Xero for small business

Posted 4 years ago in Small business by Tim Wright
Posted by Tim Wright

Australian businesses who turnover more than $75,000 annually have to lodge a business activity statement (BAS) for their either monthly, quarterly or annually to the Australian Tax Office (ATO) to report and pay GST and sometimes other taxes.

A small business may use their advisor to help them prepare and lodge their BAS, or they prepare themselves and manually enter the information and lodge with the ATO portal online or the ATO paper form by post. This is time-consuming and error-prone, as it forces double handling of data across different systems.

But now, lodging activity statements with Xero makes BAS lodgement easier by eliminating the need to rekey data or submit paper forms; saving time and reducing transposition errors.

Reducing double entry and saving time

The new ability to lodge activity statements from Xero gives businesses the freedom and control to meet their monthly or quarterly compliance requirements faster than before, either via their connected advisor or directly to the ATO.

Built directly into Xero and included at no extra cost into existing Australian Xero Business subscriptions. Business owners and their advisers can now be connected in real time to the ATO for their BAS from Xero directly. They can see when their BAS is due, check whether they’ve filed which helps to manage their cash flow far more easily. Bringing BAS lodgement directly into Xero has the potential to help significantly reduce BAS preparation and lodgment times from an average of 1.4 hours each quarter to minutes.

Since releasing to Xero certified advisers a few weeks ago, thousands of BAS have been successfully lodged from Xero.

How to start lodging activity statements

Step 1: Connect Xero to the ATO

To be able to lodge activity statements directly to the ATO, small businesses need to authorise  Xero to do it. To give the authorisation, call the ATO on 1300852232.

Step 2: Lodge your BAS

After Xero is authorised, activity statements can be viewed on the BAS dashboard. Data from Xero, including GST, is automatically updated into the BAS report, and adjustments can be made manually. After completing the required fields on the activity statement hit the Lodge to ATO button to submit the completed BAS to the ATO.

For more step-by-step instructions, see the Xero Central help page.

Get help from a Xero certified advisor

Xero certified advisors can also quickly lodge activity statements on behalf of their clients from within Xero. Having all the information in one place eliminate double-handling of data and means they spend less time chasing data. This enhanced visibility allows advisors to collaborate more closely with their clients, and help them plan ahead and manage cash flow to meet their obligations.

Chat with your advisor if you’re unsure whether you should lodge your activity yourself or through them. If you need to find an accountant or bookkeeper, check out the Xero advisor directory or find a nearby advisor in Sydney now. Lodge activity statements from Xero is now available for free to Australian Xero subscribers who have BAS. Start by connecting your account to the ATO today,

10 comments

Dean
December 12, 2018 at 5.01 pm

Does this include submission of IAS as well?

Tim Wright in reply to Dean
December 12, 2018 at 5.34 pm

@dean – Is the business ABN registered for GST ?
If so, once authorised with ATO to connect with Xero, the ATO will tell Xero the outstanding Activity Statements (BAS or IAS) that business needs to submit and they can be prepared and submitted from Xero.

Tim Wright in reply to Dean
March 16, 2020 at 10.46 am

Yes, IAS and BAS as supplied to software for an ABN holder by the ATO.

Charles
December 13, 2018 at 3.43 pm

ATO is requesting a sofware provider ID ……. where is this located?

Tim Wright in reply to Charles
December 14, 2018 at 12.39 am

@charles, the software ID (or SSID) is something that we display for you in Xero during the connection and authority process. You give this SSID to the ATO to authorise Xero to connect to the ATO on your behalf. We give you instructions on this, as well as the SSID itseldf in Xero during the connection and authoriuty process. Some more information is here in Xero Central https://central.xero.com/s/article/Lodge-activity-statements-with-Xero#ConnectyourorganisationtotheATO
If you’re having difficulty, drop our customer experience team a note and they’d be happy to help you further.

Richard Saunders
December 13, 2018 at 8.14 pm

When you lodge with Xero for a quarterly BAS, do you get a 4 week lodgement extension like when a tax agent lodges?

Tim Wright in reply to Richard Saunders
December 14, 2018 at 12.46 am

@richard, any extensions a business or an agent has remain in place. The ATO will be able to help you understand whether you have one, or are entitled to one.
Just a quick further thought on this topic. If you have an ATO extension this is not reflected in the BAS due dates the ATO provides Xero (or other software providers). This means we can’t show an extended due date for BAS if you have one, we show the due date the ATO provides us. Whilst the ATO don’t give Xero the extended due date to display, the extension with the ATO does apply in real life.
I’m sorry if this effects you and it is something thats known to the ATO and the systems they provide. We hope they improve this in the future so that the real due date (with extension) is displayed in Xero.

tm
March 12, 2020 at 5.48 pm

tm
Hi Tim,

What information is transferred to the ATO when you lodge an activity statement via Xero?

Is it just the normal BAS fields, (1A, G1, W1 etc) or does it include the individual transaction data that is included in the “Transactions by Tax rate” and “Transactions by BAS Field” tabs?

Thanks
Tony

Tim Wright in reply to tm
March 16, 2020 at 11.01 am

@tony
It is the normal/specific BAS fields (eg g1, 1a, 1b etc) thats sent to the ATO by Xero.
The data we send to the ATO from Xero for BAS is in line with the data you’d key in to the ATO portal to lodge your BAS that way.
None of the detailed reports we provide in Xero to help check / review the transctions included in the BAS period (transactions by tax rate), or the BAS proper (transacvtions by BAS field) are sent to the ATO.
Hope that helps,
Thanks, Tim

Peta Fleming
April 4, 2020 at 1.33 pm

I am no longer am a BAS Agent as I only have reduced my practice to 2 clients only. How do I unlink my BAS Agent details from a Xero file so that I can set-up a Business one?

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