Small businesses, tax professionals, software developers and industry representatives have all told us that GST reporting on the business activity statement (BAS) and the associated coding of GST transactions should be made easier.
To address this, we are working closely with the software industry on the Simpler BAS project. From 1 July 2017, small business will only need to report:
- G1 Total sales
- 1A GST on sales
- 1B GST on purchases.
Simpler BAS will make it easier and quicker for small businesses as it will allow for easier classification of transactions, preparation and lodgment of the BAS. This will deliver significant time and cost savings.
The GST Calculation worksheet and associated suite of GST software tax codes will no longer need to be supported for small business.
Simpler BAS will become the default GST reporting method for all small business.
Throughout 2016-17 we will continue user testing the Simpler BAS coding and reporting solution with small businesses, tax professionals and software developers including MYOB, Intuit, Reckon and Sage.
Phase 1: July 2016 – September 2016
- Test the manually re-configured accounting software to identify system constraints and design issues that will impact on the Simpler BAS digital coding and reporting experience.
- Co-design an enhanced end user experience through software enhancements with participating software developer partners and a team of tax professionals who are also software certified consultants.
- Surface the initial perceptions of the Simpler BAS coding and reporting solution.
Phase 1 Alpha testing findings and recommendations for software developers can be found in the Simpler BAS Phase 1 Alpha Testing Findings report (PDF, 499KB)
Phase 2: October 2016 – December 2016
- ATO to provide Simpler BAS system specifications and incorporate Phase 1 Alpha testing findings into the detailed co-design activities with software developer partners.
Phase 3: January 2017 – March 2017
- Test and fully understand the Simpler BAS coding and reporting experience with newly registered GST businesses.
Phase 4: April 2017 – June 2017
- Test our software developer partners’ updated digital accounting solutions with 2,000 small businesses.
- Measure the time and costs saved through the new Simpler BAS digital coding and reporting solution.
To assist small businesses in finding your Simpler BAS enabled software, register on the Australian Business Software Industry Association Product Catalogue now. After registering, add your product then add ‘Simpler BAS’ as a certification in your product details.
The following ATO specifications are located on sbr.gov.au and provide guidance for the system impacts associated with Simpler BAS.
- SBR Activity Statement Business Implementation Guide (PDF, 328KB)
- SBR ABN Registration Services (ABNREG.0002 2017)
- SBR ABN Registration Check Status (ABNREGSTS.0002 2017)
- SBR Activity Statement Services (AS.0001 2009)
- SBR Tax Practitioner Client Management Reports (TPCMR) Business Implementation Guide (PDF,737KB)
- SBR Tax Practitioner Client Management Report (TPCMR 2017)
- Release schedule for Simpler BAS specs (PDF, 230KB)
- Enterprise Verification Testing Environment schedule
- 1 July 2017 – Simpler BAS goes live
- May 2017 – Transitional correspondence issued to tax practitioners and small business
- 6 April 2017 – Enterprise Testing Verification Environment live for SBR1 & 2 (Add Tax Role) and SBR 1 (AS List, Pre-fill, pre/lodge)
- 16 Mar 2017 – Priority specifications published
- 16 Mar 2017 – Enterprise Testing Verification Environment live for SBR2 (AS List, Pre-fill, pre/lodge) and SBR 1 & 2 (SBAS ABN Registration, ABN Registration Status Check, AS Client Report)
- 19 January 2017 – Simpler BAS reporting options for new business
- 1 July 2016 – User testing commences
- 3 May 2016 – Government announcement
Passage of the Treasury Laws Amendment Bill 2016
Parliament is currently considering amending the small business turnover threshold from the existing level of $2m to $10m. If the proposed change becomes law, there will be an increase in the number of small businesses who will benefit from Simpler BAS (approximately 120,000 out of approx. 2.7m small businesses).
The Treasury Laws Amendment (Enterprise Tax Plan) Bill 2016 was introduced to the House of Representatives on 1 September and amended by the Senate on 31 March 2017. The bill is expected to pass and receive Royal Assent in May 2017.
New to business offer
Since 19 January 2017, we have provided newly registered small businesses the option to report less GST information on a simpler BAS. These arrangements have provided greater flexibility for software developers to release Simpler BAS digital coding and reporting solutions to new businesses in the lead up to 1 July 2017.
Auto-reconfiguration of accounting software
Automated re-configuration of GST coding and rules in accounting software will minimise transitional costs for small business to access Simpler BAS benefits. The Tax Practitioner Board has confirmed that auto-reconfiguration will not constitute 'tax advice' under the following circumstances:
- The election to re-configure is a decision made by the small business and/or tax practitioner.
- Consolidation of tax codes is consistent with the original tax treatment decision (ie multiple 0% codes can be consolidated into a single 0% code, multiple 10% codes can be consolidated into a single 10% code).
- Unique customised tax codes should be retained (ie unchanged)
- An appropriately worded declaration is required making it clear to clients that the software provider is not a registered agent and that clients relying on tax or BAS advice should request advice from a registered agent.
TPB(I) D27/2015 Software providers and the Tax Agent Services Act 2009 provides more information for software developers considering providing auto-reconfiguration services to enhance their client experience.
GST validation rule changes
GST validation rules are scheduled to be turned off from 24 June 2017 to support the Simpler BAS. This applies for all BAS lodgments from this date and includes BAS periods prior to 1 July 2017.
Lodgment requirements for BAS periods pre 1 July 2017
Whilst we would prefer to receive the final BAS lodgment for 2016 -17 with all the GST labels it is acknowledged that some accounting software products may not be able to produce a BAS with all 7 labels once re-configured to the Simpler BAS coding and reporting solution.
For small businesses who have reconfigured their accounting software before 1 July 2017 BAS lodgment, we will accept BAS for periods prior to 1 July 2017 with only the following GST information – G1 Total sales, 1A GST on sales and 1B GST on purchases.
Australian Business Software Industry (ABSIA): Special Interest Working Group
The Australian Business Software Industry (ABSIA) has formed a special interest working group that will represent the industry in relation to transactional and indirect tax related changes, including Simpler BAS. This group will provide a whole of industry perspective to influence and shape the end state system solution.
If you are interested in becoming a member of the special interest working group or receiving ABSIA updates email ABSIA.
Find out more:
- Simpler BAS announced at the delivery of the federal budget (PDF, 920KB)
- Simpler BAS preliminary solution overview (PPT, 445KB)
- Simpler BAS client metrics and population breakdown (PDF, 420KB)
- Preliminary design issues for software developers to consider (PDF, 163KB)
- Overview of research and consultation (PPTX, 273KB)