To prepare BAS in Xero without guessing GST, finish bank reconciliations for the period, fix uncoded and mis-coded transactions, check GST reports against invoices, then open Reports → Activity Statement (or Tax → Activity statements, depending on your Xero version), review the draft figures, and lodge through Xero if connected to the ATO — or export for your registered BAS agent. The due date is on your BAS; quarterly statements are usually due on the 28th of the month after the quarter (28 February for October–December), and monthly statements on the 21st of the following month.
That is the short answer. The rest of this guide walks Australian sole traders, tradies, and small companies through a practical Xero BAS process — what to check, what the labels mean, and when to stop DIY and call a registered BAS agent.
This is a bookkeeping and BAS lodgement how-to for GST-registered businesses using Xero. It is not income-tax strategy advice. For tax returns, deductions strategy, or company structuring, speak to your registered tax agent or accountant. Girl Friday Australia is a registered BAS agent, Xero Certified Advisor, and Xero Gold Partner — we prepare and lodge BAS & IAS, keep the books clean, and hand tax strategy to your tax agent when needed.
What “prepare BAS in Xero” actually means
A Business Activity Statement (BAS) is the ATO form that collects GST, PAYG withholding, PAYG instalments, and (where relevant) other labels such as fuel tax credits for a reporting period. Xero does not invent your GST — it aggregates how you coded sales and purchases. If the coding is wrong, the BAS is wrong.
So “prepare BAS in Xero” means:
- Make the period complete (banks, cards, and clearing accounts reconciled)
- Make the GST coding trustworthy (tax invoices, codes, and exceptions fixed)
- Review the Activity Statement draft against source documents
- Lodge (and usually pay) by the due date shown on the BAS — or via your agent under the ATO lodgment program
If you want the bigger picture of GST rules (registration, taxable supplies, input tax credits), read our GST in Australia complete small business guide. This post stays on the Xero how-to, not another GST pillar.
Who this guide is for (and who should hand it over)
Good DIY candidates
- You reconcile Xero weekly (or at least monthly) and know your chart of accounts
- You have tax invoices for purchases where you claim GST credits
- Your GST turnover and reporting cycle are stable (quarterly or monthly)
- You have time before the due date — not the night before with six weeks of unreconciled feeds
Better with a registered BAS agent
- Catch-up books, messy historical coding, or “I think I registered for GST but I’m not sure”
- Employees and PAYG withholding sitting on the same BAS (payroll mistakes compound)
- Fuel tax credits, mixed private/business use, or complex supplier GST
- You want the BAS agent lodgment program concessions (extra time on many quarterly statements when lodged electronically by a registered agent)
- You would rather spend the time on clients than on G1 vs 1A
Girl Friday’s BAS & IAS lodgement starts from $180/quarter, and bookkeeping from $250/month. No lock-in contracts. If you are unsure whether you need a BAS agent or a tax agent, see BAS agent vs tax agent.
Before you open the Activity Statement: the prep checklist
Do these in order. Skipping reconciliation and jumping straight to lodge is how GST gets guessed.
1. Lock the period dates
Know exactly which days the BAS covers. For quarterly GST:
- Q1 (Jul–Sep): period 1 Jul – 30 Sep · standard due date 28 October
- Q2 (Oct–Dec): period 1 Oct – 31 Dec · standard due date 28 February
- Q3 (Jan–Mar): period 1 Jan – 31 Mar · standard due date 28 April
- Q4 (Apr–Jun): period 1 Apr – 30 Jun · standard due date 28 July
Monthly GST: due on the 21st of the month after the period (e.g. July BAS due 21 August).
Always use the due date printed on your BAS. Weekends and public holidays can shift the effective payment date. Source: ATO — Due dates for lodging and paying your BAS (last updated 10 September 2026).
2. Reconcile every bank and credit card feed
In Xero, open each account for the period and clear the reconcile queue. Watch for:
- Transfers coded twice (or not at all)
- Owner drawings coded as expenses with GST
- Personal spend on the business card
- Missing receipts for supplier payments
- Duplicate bank rules creating wrong accounts
Unreconciled transactions are unfinished books. The Activity Statement will still draft — it just will not be trustworthy.
3. Clear suspense, “Ask my accountant”, and uncoded spends
Anything parked in holding accounts needs a real account and a GST code before you lodge. Same for waits-for-receipt items if you are claiming input tax credits.
4. Check sales for the period
- Every taxable sale should have the right GST code (usually GST on Income)
- Export sales, GST-free, and out-of-scope need the matching codes — do not leave them as taxable by default
- Credit notes and refunds should reverse GST correctly
- Deposits and progress claims: confirm whether GST applies under your invoicing method (cash vs accrual / invoices basis)
5. Check purchases and bills
- Claim GST credits only when you hold a valid tax invoice (where required)
- Private use: do not claim full GST on mixed-use spends — adjust or split
- Capital purchases: code so the BAS and your asset records stay aligned (your tax agent handles depreciation / write-off on the tax return — see our instant asset write-off guide)
- Import GST and deferred GST schemes: follow your accountant’s coding — do not invent a workaround in “Office expenses”
6. Payroll and PAYG withholding (if you have employees)
If your BAS includes PAYG withholding, finalise payroll for the period, check STP reporting is current, and confirm the withholding labels match payroll reports. Mistakes here are expensive. If Payday Super / qualifying earnings still confuse you, read our Payday Super Xero employer guide and get payroll reviewed before you lodge.
7. Run GST reports in Xero before the Activity Statement
Use GST reconciliation / GST audit style reports (names vary by Xero plan) for the same period as the BAS. Spot-check:
- Large purchases with no GST claimed when they should have GST
- Income with GST when it should be GST-free
- Rounding that looks wild compared to prior periods
Definition — Accruals vs cash accounting for GST: Your BAS basis (accounts / invoices basis vs cash basis) is set with the ATO. Xero’s Activity Statement follows that method. If you are unsure which basis you are on, check your ATO records or ask your BAS agent before you change settings in Xero.
How to run the Activity Statement in Xero (step by step)
Xero’s menu labels move occasionally. Look under Reporting / Reports or Tax for Activity Statement / BAS. The workflow is consistent even if the click path shifts.
Step 1 — Open the Activity Statement for the correct period
Select the BAS period that matches the ATO form. Do not invent a custom date range that cuts across quarters unless you are diagnosing something — lodge what the ATO asked for.
Step 2 — Confirm your GST accounting method
Cash vs invoices (accruals) must match your ATO registration. If Xero and the ATO disagree, your figures will never “feel” right. Fix the setting with advice — do not flip it mid-year to make a number look nicer.
Step 3 — Review the GST summary labels
Common GST labels you will see (wording can vary slightly):
- G1 — Total sales (including GST)
- G2 / G3 — Export and other GST-free sales (where relevant)
- G10 / G11 — Capital and non-capital purchases (including GST)
- 1A — GST on sales
- 1B — GST on purchases (input tax credits)
Your net GST is typically 1A minus 1B (you pay if positive; you may get a refund if negative, subject to ATO processing). Do not edit labels in isolation to “balance” to a gut feel — fix the underlying transactions.
Step 4 — Review PAYG and other labels
If applicable:
- W1 / W2 (and related) — PAYG withholding amounts from payroll
- T / PAYG instalment labels — instalment amount or rate as notified by the ATO
- Fuel tax credit labels — only if you claim them and your records support them
If a PAYG instalment amount looks unfamiliar, check the ATO notice — do not overwrite it because last quarter felt different.
Step 5 — Compare to last period and to your P&L
Ask three boring questions:
- Did sales move roughly in line with G1?
- Did big one-off purchases explain a spike in credits?
- Did payroll hours / headcount explain withholding changes?
If the answer is “I have no idea,” pause lodgement and investigate.
Step 6 — Lodge (or send to your BAS agent)
Options usually include:
- Lodge from Xero if ATO connection / SBR is set up and you are authorised
- Lodge via Online services for business using figures from Xero
- Hand to your registered BAS agent to lodge through Online services for agents / PLS
After lodgement, record the lodgement in Xero so the period is marked lodged and the ATO liability / refund is reflected in your accounts (many files use an ATO clearing / integrated GST payable account — follow your bookkeeper’s pattern).
Step 7 — Pay on time (or arrange payment)
Lodging without paying is still late payment. Use the payment reference on the BAS. If you cannot pay in full, contact the ATO early about a payment plan — and still lodge on time. For broader debt context, see our ATO tax debt 2026 guide; for a payment arrangement conversation, speak to the ATO and your adviser.
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Mid-article CTA: Tired of Sunday-night BAS panic? Girl Friday Australia can prepare and lodge your BAS as a registered BAS agent (from $180/quarter) and keep your Xero file clean with bookkeeping from $250/month. Get a free quote or book a discovery call — phone 0404 877 436 · email info@girlfridayaustralia.com.
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Standard due dates vs BAS agent lodgment program
Two clocks matter:
- Standard due dates on your BAS (28th after each quarter / 21st after each month for monthly GST)
- Registered agent lodgment program concessions when an eligible statement is lodged electronically by a registered tax or BAS agent
Per the ATO’s BAS agent lodgment program 2026–27:
- Q4 2025–26: original due 28 July 2026 · BAS agent concession 25 August 2026
- Q1 2026–27: original due 28 October 2026 · BAS agent concession 25 November 2026
- Q2 2026–27: original due 28 February 2027 · BAS agent concession not applicable (no extra concession)
- Q3 2026–27: original due 28 April 2027 · BAS agent concession 26 May 2027
- Q4 2026–27: original due 28 July 2027 · BAS agent concession 25 August 2027 (confirm when 2027–28 program is published)
Important caveats (ATO wording summarised):
- Concessions generally apply when you lodge electronically through a registered agent and prior activity statements were lodged in a way that qualifies you for the program
- First activity statements, or prior paper lodgements, may still need the earlier due date — confirm with your agent
- Monthly activity statements generally have no agent concession, except a December monthly concession for eligible clients (turnover up to $10 million) lodging electronically via a registered agent (ATO program: 21 February for December monthly)
- Self-lodgers who lodge online may get a separate short extension on some quarterly BAS — check the ATO page for your situation; Q2 already includes a longer statutory window, so the usual “extra fortnight” pattern does not add another concession in the same way
Do not assume you have until late November just because a mate’s bookkeeper does. Eligibility is case-by-case.
Common Xero BAS mistakes (and how to avoid them)
- Lodging with unreconciled banks — drafts look complete; reality is not
- Guessing GST on cash withdrawals and owner drawings — drawings are not taxable sales; do not code them as income with GST
- Claiming GST without a tax invoice — keep supplier tax invoices on file
- Treating the BAS as a tax return — depreciation, instant asset write-off, and Division 7A are not fixed by editing 1A
- Ignoring PAYG instalment notices — wrong T amounts create debt and confusion
- Changing cash/accrual midstream without advice — breaks comparability and can create duplicate or missing GST
- Using bank rules that force GST on everything — rules are helpers, not auditors
- Leaving employee reimbursements coded as supplier bills with GST when they should be different
- Forgetting credit card statements — another feed, another reconciliation
- Waiting until the due date to start — prep is a week-of-month (or week-of-quarter) habit, not a two-hour cram
Cash flow tip: separate “GST payable” from “profit”
If GST collected sits in the same bank account as wages and supplier payments, it will get spent. Many owners:
- Transfer an estimate of net GST to a separate savings account through the quarter, or
- Review Xero’s GST liability position monthly and set aside the movement
Your BAS is easier emotionally when the money is already waiting.
When Girl Friday should take the keyboard
Hand us the file (or invite us as a Xero user) when:
- You are behind on reconciliations and the due date is close
- You need catch-up bookkeeping before any lodgement is safe
- You want ongoing monthly bookkeeping plus quarterly BAS
- You want agent lodgment program timing without DIY risk
- You need plain-English explanation of what you owe and why
We work Australia-wide remote, Mon–Fri 9am–5pm AEST, with replies within one business day. We do not do lock-in contracts or jargon for sport.
Scope reminder: we lodge BAS & IAS and keep books tax-ready. Income-tax returns and strategy stay with your tax agent — we collaborate, we do not replace that role. More on that split in BAS agent vs tax agent.
Frequently asked questions
Can I prepare my BAS in Xero if I am not a BAS agent?
Yes. Business owners can prepare and lodge their own BAS. You are responsible for correct figures and on-time lodgement and payment. A registered BAS agent can lodge for you and may access lodgment program concessions. Choose based on complexity and your appetite for ATO risk — not on whether Xero has a button.
Does Xero lodge my BAS automatically?
No. Xero prepares figures from your coded transactions. You (or your agent) still review and submit. ATO connection features help transmission; they do not replace review.
What if my Activity Statement looks wrong?
Do not overwrite labels to force a number. Fix bank recs, GST codes, and missing bills, then refresh the statement. If it still looks wrong, export transaction lists for G1 / 1A / 1B and compare to invoices.
Cash or accrual — which should I use in Xero for BAS?
Use the GST accounting method registered with the ATO. If you want to change method, that is an ATO / adviser decision, not a cosmetic Xero toggle.
How long should I keep BAS records?
Keep records that explain your BAS figures (tax invoices, bank statements, payroll reports, working papers) for the periods the ATO requires — generally at least five years. Digital copies in Xero attachments are fine if complete and readable.
What happens if I lodge late?
The ATO can apply failure-to-lodge penalties and general interest charge on unpaid amounts. Lodge even if you cannot pay in full, then talk to the ATO about payment options. Do not ignore the form.
Can Girl Friday lodge if my books are a mess?
Yes — that is catch-up work. We assess the backlog, rebuild reconciliations and GST coding as needed, then lodge. Pricing depends on how far behind you are; ongoing bookkeeping floors start from $250/month and BAS & IAS from $180/quarter once the file is in a lodgable state.
Soft next step
If you want this done properly every quarter — reconciled Xero, reviewed GST, lodged BAS, plain-English summary — get a free quote or start a discovery call. Explore BAS & IAS, bookkeeping, and tax support. Phone 0404 877 436 · email info@girlfridayaustralia.com.
Prepare BAS in Xero with a checklist, not a guess. Your future self (and your ATO login) will thank you.