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How can businesses lodge and pay tax online?

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Lodging and paying tax online is simple and secure thanks to the Australian Taxation Office (ATO). They provide a range of online solutions to make tax payments more convenient. Let’s discuss the different types of businesses, when tax returns are due for them, and how to lodge and pay your tax online.

All Australian businesses need to lodge a tax return every year, whether online or offline. When a business lodges a tax return to the ATO, they should understand the various rules that apply to their business structure.

If your business is a:

  • Sole trader – sole traders need to lodge an individual tax return which should include their business income using a separate business schedule. They do not need to lodge a separate tax return for their business.
  • Partnership – partnerships have their own tax file number (TFN). However, they do not pay income tax on their earnings. Each partner will report their portion of the partnership income in their own income tax return. In addition, a partnership should lodge a separate partnership return every year to the ATO under the business TFN.
  • Company – a company is classified as a separate legal entity and should lodge a company tax return and pay tax on its earnings. Company Directors will still need to lodge their own personal tax return as an individual.
  • Trust – trusts possess their own TFN and should lodge a trust income tax return.

For not-for-profit (NFP) organisations, there may be some tax concessions. Here are the tax concessions available for NFP organisations from the ATO.

When are tax returns due?

For individuals, sole traders, partnerships, and trusts, tax returns are generally due by 31 October every year, except if a registered tax agent will be the one to lodge it for you.

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As for BAS, the due dates vary, and payments may be done monthly or quarterly.

When to lodge a Business Activity Statement (BAS)

The ATO will inform a business should they need to lodge a BAS. They would send an activity statement around two weeks prior to the end of a business’ reporting period. They should be completed and returned by the due date, together with any payment owed.

The BAS is applicable if a business is required to report their responsibilities for a range of taxes, which includes:

  • Pay As You Go (PAYG) Withholding and instalments
  • Goods and Services Tax (GST)
  • Fringe Benefits Tax (FBT) instalments
  • Wine Equalisation Tax

How to lodge tax returns and pay tax online

A business may choose to lodge their own tax return or have a tax accounting specialist do it for them. This would depend on the complexity of the business and its taxes.

Individuals and sole traders may use the ATO’s myTax system to pay tax online which is found here.

For businesses that are required to lodge a BAS and want to do it themselves may use the ATO’s Business Portal here.

Business owners can pay their tax through BPAY, direct credit, or direct debit. In addition, mail payments as well as payments using your local post office are other acceptable methods to pay for taxes.

The ATO has made paying tax online easy and convenient. Just make sure you’re getting all the deductions that you and your business are entitled to. If you need reliable advice on how to legally reduce your business tax costs, speak with a Chan & Naylor business tax accountant here today.

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