If you pay someone to complete your business activity statement (BAS), or if you provide such a service yourself, you may be affected by recent legislative changes.
In March 2010, the Australian Taxation Office introduced new legislation, the Tax Agent Services Act 2009, which affects businesses that charge GST and submit a BAS.
There are no actual changes to GST or the business activity statement. Instead, the new Act states that anyone you pay to make GST-coding decisions when entering data into an accounting system, and who is not an employee of your business, needs to be either:
- a registered BAS agent;
- a registered tax agent; or
- employed by, and under the instruction of, a registered tax agent.
This is legislation that both business owners and accounting professionals have long been asking for, and will enable you to have greater confidence that appropriate accounting practices are being used in your business.
Implications for bookkeepers
The new legislation affects you if you provide a service to a client, for a fee, for any of the following:
- Installing computer accounting software and determining default GST codes tailored to the client.
- Coding tax invoices and transferring data onto a computer program for clients.
- Reconciling data entry to ascertain the figures to be included on a client’s BAS.
- Filling in the BAS on behalf of an entity or instructing the entity which figures to include.
- Ascertaining the withholding obligations for the employees’ of your clients. This includes preparation of payment summaries.
If you charge fees for any of these services, under the Tax Agent Services Act 2009 you will need to be registered as a BAS agent with the Tax Practitioners’ Board.
If you provide these services as an employee (i.e. are paid a wage to perform these tasks) then you do not need to register.
Note that it is the responsibility of all bookkeepers to make themselves aware of their registration responsibilities under the new Act. There are three categories of registration and there is also a transition period for registration. All the relevant information is available from the Tax Practitioners’ Board.
Implications for business owners
If you’ve outsourced your bookkeeping and/or accounting, it’s in your best interests to ensure that you’ve engaged a registered BAS agent.
Amongst other important questions to ask your bookkeeper are:
- Are you a registered BAS agent?
- Do you have professional indemnity insurance?
If the answer to either of these questions is ‘No’, it’s time to find a new bookkeeper who does meet the high standard of experience and qualifications required for registration.
The new legislation helps the business community to have confidence that the people they engage to do their bookkeeping and BAS-related accounting have the necessary qualifications and experience.
Bookkeepers and accountants also stand to benefit, as unqualified individuals will no longer be able to perform these services, which are so vital to the running of thousands of businesses across the country.
Any changes to the tax system can be confusing. If you’ve got any questions, concerns or comments relating to the business activity statement (BAS), please post them below.