Chartered Accountant Timothy Quinn leads Tax & Accounting at Lawpath. 16+ years in tax advisory, specialising in startup growth and expansion. Passionate about supporting entrepreneurial clients with early-stage investment incentives, restructuring, international exit strategy planning, and more.
- Businesses with a GST turnover of $20 million or more must report GST monthly.
- Businesses with revenue below $20 million generally report quarterly unless they choose monthly reporting or the ATO directs them to switch.
- The ATO may require monthly reporting if a business is not meeting its GST obligations.
- Monthly reporting means smaller, more frequent GST payments rather than one larger quarterly amount.
- Monthly BAS requires more frequent bookkeeping and reconciliation.
- If your business has a GST turnover below $10 million, you may still be able to use the Simpler BAS.
- Consider cash flow, record-keeping capability, and compliance history before voluntarily changing cycles.
For many Australian businesses, BAS reporting is quarterly by default. But monthly GST reporting sometimes becomes mandatory, the ATO may direct it, or you may choose it voluntarily.
This article explains when a business should switch from quarterly to monthly BAS, what changes to expect, and what to consider before making the switch.
- What is monthly BAS reporting?
- Who has to lodge monthly BAS in Australia?
- Why would the ATO move a business from quarterly to monthly BAS?
- What happens if your GST turnover reaches $20 million?
- Can a business voluntarily change from quarterly to monthly BAS?
- Should you switch to monthly BAS voluntarily?
- Monthly vs quarterly BAS: what changes?
- Do you need to change from cash to accrual GST reporting?
- Can you switch back from monthly to quarterly BAS?
- What if you have fallen behind on quarterly BAS?
- Monthly BAS readiness checklist
- When should you get accounting or BAS support?
- FAQs
What is monthly BAS reporting?
ATO monthly BAS reporting means calculating, reporting, and paying relevant GST obligations each month rather than once each quarter. For monthly GST reporters, BAS is due on the 21st day of the following month.
Not every item on a BAS necessarily follows the same cycle. PAYG withholding, PAYG instalments, and other obligations can have their own reporting frequencies. This article primarily discusses the GST reporting cycle.
Who has to lodge monthly BAS in Australia?
Every GST-registered business in Australia has to lodge BAS. However, you’ll need to start reporting GST monthly if your GST turnover is $20 million or more.
The ATO can also require some businesses with a turnover below $20 million to move to monthly GST reporting.
| Business situation | Typical GST reporting cycle |
|---|---|
| GST turnover of $20 million or more | Monthly required |
| GST turnover below $20 million | Usually quarterly unless otherwise directed or elected |
| Voluntarily registered with GST turnover below the registration threshold | Annual will be available, quarterly is optional |
| ATO directs monthly reporting | Monthly required |
Annual reporting rules are more limited and depend on eligibility, so businesses should confirm their own position with the ATO or a registered tax or BAS agent.
Why would the ATO move a business from quarterly to monthly BAS?
The ATO may direct a business to monthly GST reporting if it’s not meeting its GST obligations.
Triggers may relate to a business’s GST compliance history rather than simply its turnover. The ATO doesn’t publish a fixed enforcement threshold, and a single late BAS doesn’t automatically mean a business will be moved to monthly reporting.
If the ATO directs the change, it will notify you in writing, and the monthly reporting requirement generally applies for at least 12 months.
What happens if your GST turnover reaches $20 million?
Once your GST turnover threshold requires monthly reporting, the business must move onto the monthly cycle and lodge electronically.
There are two key reporting thresholds:
- $20 million means you need to switch to monthly GST reporting.
- $10 million affects whether full GST reporting or Simpler BAS applies.
A business with turnover between $10 million and $20 million may report quarterly, but will need to use full GST reporting rather than Simpler BAS.
Can a business voluntarily change from quarterly to monthly BAS?
Yes. The ATO allows businesses with a GST turnover below $20 million to choose monthly GST reporting.
You may consider doing so if:
- Quarterly GST bills create cash-flow shocks.
- Bookkeeping is already completed monthly.
- GST refunds are regularly due.
- Transaction volumes are high.
- Management wants more frequent tax visibility.
- The business wants to avoid accumulating three months of GST before payment.
Monthly reporting isn’t automatically better. It suits businesses with reliable monthly bookkeeping, but it can add administrative work.
Should you switch to monthly BAS voluntarily?
If you’re considering a change in your BAS reporting cycle, here are some situations that may affect that decision:
| Monthly may suit you if… | Quarterly may remain suitable if… |
|---|---|
| Books are reconciled monthly | Accounting is genuinely managed quarterly |
| Quarterly GST bills cause cash-flow pressure | The business comfortably reserves GST |
| GST refunds arise regularly | The GST position is straightforward |
| Transaction volumes are high | Transaction volume is relatively low |
| You want tax liabilities to be visible sooner | Extra monthly administration adds little value |
If the ATO requires monthly reporting, this is no longer a voluntary business decision.
Is monthly BAS better for cash flow?
It can be, depending on the business.
| Potential benefit | Potential downside |
|---|---|
| GST is dealt with in smaller, more frequent amounts, making it harder to accidentally spend GST collected over a full quarter. | Businesses have less time to collect GST and pay it to the ATO. |
| More frequent reporting can help businesses improve cash-flow management. | Monthly lodgement creates more regular compliance work. |
Importantly, monthly reporting changes the timing of cash flow. It doesn’t reduce the GST ultimately payable.
Does monthly BAS mean you pay more GST?
No. The reporting cycle changes when GST is calculated and paid, not when the underlying GST rate or entitlement to eligible GST credits changes.
For example, if a business has a quarterly GST liability of $12,000, monthly reporting might result in:
- July: $3,500
- August: $4,100
- September: $4,400
The total remains $12,000, assuming the same underlying transactions. Liabilities won’t necessarily divide evenly between months.
Can monthly reporting help businesses that regularly receive GST refunds?
Potentially. If you regularly have input tax credits exceeding GST collected, you may get the refund back sooner.
Examples may include:
- Businesses making significant capital purchases
- Businesses in an investment or growth phase
- Exporters or businesses with substantial GST-free sales
More frequent reporting means the business reports its GST position more frequently. It doesn’t guarantee faster refund processing.
Monthly vs quarterly BAS: what changes?
Here is a quick overview of the differences:
| Monthly reporting | Quarterly reporting |
|---|---|
| GST is reported every month | GST is reported every three months |
| Due around the 21st of the following month | Standard quarterly due dates apply |
| Smaller, more frequent GST payments | Larger, less frequent GST payments |
| Monthly reconciliation is needed | Quarterly reconciliation may be sufficient |
| Can surface errors sooner | Errors may accumulate for longer |
| More frequent compliance workload | Fewer lodgements |
Again, neither option is universally superior. The right cycle depends on turnover, cash flow patterns, transaction volume, and the business’s bookkeeping capacity.
What bookkeeping changes when you move to monthly BAS?
A monthly cycle generally means bookkeeping should be brought up to date every month. This includes:
- Reconciling bank accounts
- Reconciling payment processors
- Recording sales correctly
- Entering supplier invoices
- Checking GST coding
- Reconciling GST control accounts
- Reviewing adjustments and credit notes
- Identifying private and business apportionment
- Reviewing outstanding transactions before lodgement
The practical implication is that moving to monthly BAS turns GST reconciliation into a monthly close process rather than a quarterly clean-up exercise.
What are the monthly BAS due dates?
Your business will generally need to lodge BAS by the 21st day of the following month. For example, a July monthly BAS is generally due on 21 August. If the due date falls on a weekend or public holiday, the next business day applies.
Tax due dates may differ if you engage an agent for BAS lodgement. Also, December can have special timing for eligible electronic monthly reporters with a turnover of up to $10 million.
Do small businesses still use Simpler BAS if they report monthly?
Yes, potentially. Businesses with a GST turnover below $10 million can use the Simpler BAS reporting method for monthly reporting.
Under Simpler BAS, the main GST labels are:
- G1 Total sales
- 1A GST on sales
- 1B GST on purchases
The key point is that monthly reporting doesn’t automatically mean a small business has to use the full GST reporting method.
Do you need to change from cash to accrual GST reporting?
No, not simply because you move to a monthly BAS. Reporting frequency and GST accounting basis are separate matters.
These are separate decisions and rules. For more details, see Lawpath’s Cash vs Accrual Accounting article.
Can you switch back from monthly to quarterly BAS?
Reporting cycles may change depending on eligibility and timing. You’ll need to notify the ATO in the first month of the relevant quarter for the new cycle to apply immediately; otherwise, it will begin from the next quarter.
However, if the ATO has required monthly reporting, a business can’t simply elect to return to quarterly reporting.
Confirm eligibility with the ATO or a registered tax or BAS agent before planning a change.
What if you have fallen behind on quarterly BAS?
Moving to monthly reporting may be one consequence of ongoing GST compliance problems, but it doesn’t remove existing obligations. A business may still need to deal with overdue BAS, GST debt, interest, penalties, and outstanding lodgement requirements.
These historic obligations should be addressed separately from the new monthly reporting cycle. If BAS lodgements are behind, or GST records don’t reconcile, accounting or tax support can help bring the position back under control.
Monthly BAS readiness checklist
Before moving to monthly BAS, work through the following:
- Confirm whether monthly reporting is mandatory, voluntary, or ATO-directed.
- Check GST turnover.
- Confirm whether Simpler BAS or full reporting applies.
- Identify the first monthly reporting period.
- Update the accounting and bookkeeping cadence.
- Reconcile bank accounts monthly.
- Reconcile merchant and payment platforms.
- Review GST coding before each lodgement.
- Set aside GST regularly.
- Confirm monthly due dates.
- Review PAYG and other activity-statement obligations separately.
- Use a tax or BAS agent where monthly reporting creates capacity issues.
When should you get accounting or BAS support?
Consider getting accounting or BAS support where:
- The ATO has directed the business to move to monthly reporting.
- BAS lodgements are already overdue.
- Bookkeeping is not currently completed monthly.
- GST accounts do not reconcile.
- Cash flow pressure is driving repeated late payments.
- GST refunds or large input tax credits arise regularly.
- Turnover is approaching $20 million.
- The business is unsure whether changing cycles voluntarily would help.
Lawpath’s tax planning services can help with preparing, checking, and lodging BAS, while bookkeeping or accounting support can help ensure monthly records are accurate before lodgement.
FAQs
When do you have to lodge BAS monthly?
A business must lodge BAS monthly if its GST turnover is $20 million or more, or if the ATO has directed it to report monthly. Some businesses below $20 million can also choose monthly reporting.
Can a small business choose to lodge BAS monthly?
Yes. A business with a GST turnover below $20 million can choose to report and pay GST monthly. It should first consider whether its bookkeeping and cash flow can support the more frequent cycle.
Why has the ATO moved me from quarterly to monthly BAS?
The ATO may move a business to monthly reporting if it has concerns about the business’s ability to meet its GST obligations. This can relate to GST compliance history, rather than turnover alone.
What GST turnover requires monthly BAS reporting?
A GST turnover of $20 million or more generally requires monthly GST reporting.
Is monthly BAS better for cash flow?
It can be because GST is paid in smaller, more frequent amounts. However, it also means less time between collecting GST and paying it, as well as more regular bookkeeping and lodgement work.
Does monthly BAS mean you pay more GST?
No. Monthly BAS changes when GST is reported and paid, not when the amount of GST ultimately payable changes. The total GST liability should remain the same for the same underlying transactions.
When is monthly BAS due?
Monthly BAS is due for lodgement and payment by the 21st day of the following month. If that date falls on a weekend or public holiday, the next business day applies.
Can small businesses use Simpler BAS monthly?
Yes. Businesses with a GST turnover below $10 million may use Simpler BAS for monthly reporting.
Can you change from monthly BAS back to quarterly?
Sometimes, depending on eligibility and timing. If the ATO directed the business to monthly reporting, then you can’t simply switch back.
Does monthly BAS mean you have to use accrual accounting?
No. Monthly reporting and cash-versus-accrual GST accounting are separate issues.
What happens if your GST turnover reaches $20 million?
The business must move to monthly GST reporting and lodge electronically. At $10 million or more, it will also generally need to use full GST reporting rather than Simpler BAS.
Can monthly BAS help if your business regularly receives GST refunds?
Potentially. More frequent reporting allows a business to report its GST position each month rather than waiting until the end of a quarter. It doesn’t guarantee faster refund processing.
Sources:
- https://www.ato.gov.au/businesses-and-organisations/gst-excise-and-indirect-taxes/gst/when-and-how-to-report-and-pay-gst/monthly-gst-reporting
- https://www.ato.gov.au/businesses-and-organisations/preparing-lodging-and-paying/business-activity-statements-bas/goods-and-services-tax-gst/simpler-bas-gst-bookkeeping-guide
