Your BAS Is Late. Here's What Happens Next.

Missing a BAS deadline happens more often than most business owners would admit. The ATO reports that over 20% of small businesses lodge at least one BAS late each year. If it's happened to you, here's what to expect — the penalty structure, how to get penalties remitted, and how to build a system that prevents it from recurring.

The Penalty Structure

The ATO applies a Failure to Lodge (FTL) penalty for each 28-day period (or part thereof) that your BAS remains overdue after the due date. For small entities, this is currently one penalty unit per period.

The current penalty unit is $313 (as at 2025–26). So the progression is: 1–28 days late: $313, 29–56 days late: $626, 57–84 days late: $939, 85–112 days late: $1,252, and 113+ days late: $1,565 (maximum per statement).

These are per BAS statement. If you have multiple overdue BAS periods — say, you're behind on two quarterly statements — the penalties compound. Two overdue BAS periods at maximum penalty is $3,130. Fall behind on a full financial year and you're looking at $6,260 in FTL penalties alone, before any interest on unpaid amounts.

Getting Penalties Remitted

The ATO can remit (reduce or waive) FTL penalties in specific circumstances:

• First offence: If it's your first late lodgement in four years, the ATO may remit the penalty entirely on request.
• Reasonable excuse: Illness, natural disaster, death in the family, or other exceptional circumstances can justify remission if you provide supporting evidence.
• BAS agent extension: If you engage a registered BAS agent, they typically have access to an extended lodgement program that provides later due dates than self-lodgers. This is one of the most practical benefits of using a registered agent.
• Corrective action: Demonstrating that you've taken steps to prevent future late lodgements — such as engaging a professional bookkeeping service — supports a remission request.

To request remission, contact the ATO directly (phone or through your BAS agent), explain the circumstances, and request that the penalty be remitted. For first-time offences with a reasonable explanation, remission is commonly granted.

The Critical Distinction: Lodge First, Pay Later

This is the single most important thing to understand about late BAS: the FTL penalty is triggered by late lodgement, not late payment. Lodging your BAS on time but paying the amount owed late triggers interest (the General Interest Charge, currently around 11% per annum), but not the FTL penalty.

If you can't pay the full amount by the due date, lodge the BAS on time anyway, then contact the ATO to arrange a payment plan. The ATO is generally willing to negotiate payment plans for businesses that lodge on time and communicate proactively. Payment plans may even include remission of some interest charges.

Getting Back on Track

If you're currently behind on BAS lodgement, here's the action plan:

1. Lodge overdue BAS immediately — even if incomplete. An amended BAS later is better than a continued failure to lodge.
2. Engage a registered BAS agent if you don't already have one. They can access the extended lodgement program and help with remission requests.
3. Ensure your books are current. Late BAS is almost always a symptom of behind bookkeeping. Fix the root cause.
4. Build a system that starts BAS preparation on day one of the new quarter, not in the last week. A structured BAS preparation process — reconciliation, GST verification, PAYG check, draft review, lodgement — spread across the quarter prevents the last-minute scramble.

Prevention: Never Miss Another Deadline

The businesses that never miss BAS deadlines share common characteristics: their books are reconciled within 7 days of month-end, they have a compliance calendar with automated reminders, their BAS agent prepares a draft BAS early in the lodgement period for review, and BAS preparation is a process that runs continuously, not an event that happens four times a year.

The Compounding Effect of Chronic Late BAS

A single late BAS lodgement is manageable — a penalty, potentially remitted, and a lesson learned. But chronic late lodgement creates compounding problems beyond the financial penalties.

ATO risk profile elevation. The ATO maintains risk profiles for every business. Late lodgement is a red flag that increases the likelihood of broader ATO scrutiny — not just of your BAS, but of your income tax, PAYG withholding, and superannuation compliance. Once your risk profile is elevated, it takes consistent on-time lodgement over multiple periods to return to normal.

Cash flow management blindness. BAS preparation forces a quarterly financial discipline — reconciling accounts, classifying GST, reviewing debtors and creditors. When BAS is chronically late, this discipline erodes. You lose regular visibility into your cash flow position, your GST exposure, and your PAYG obligations. Decisions that should be informed by current financial data are made on instinct instead.

Accountant relationship strain. Your accountant relies on quarterly BAS data to track your tax position throughout the year. Late BAS means your accountant can't provide accurate interim tax estimates, can't advise on timing of deductions or investments, and faces a more complex year-end process. The flow-on cost is a higher year-end accounting bill and less useful tax planning advice.

Financing implications. Banks and lenders increasingly request ATO portal access as part of lending assessments. A history of late BAS lodgement signals financial management weakness and can affect your ability to secure or refinance business lending — precisely the financing you might need if cash flow has been poorly managed.