Quick answer
If you can't pay your BAS by the due date, lodge it on time anyway, because failing to lodge creates penalties and can affect director penalty outcomes. Then contact the ATO about a payment plan or pay what you can, and consider short-term funding for the rest. A line of credit suits recurring quarterly BAS pressure; a short-term loan suits a one-off. Don't let unpaid BAS roll into the next quarter.
Key points
- Always lodge on time, even if you can't pay in full.
- Late lodgement of BAS can affect a director's options under a director penalty notice.
- Payment plans are available, but general interest charge accrues and is non-deductible from 1 July 2025.
- Recurring BAS pressure suits a line of credit and a separate tax account.
- Always
- Lodge on time
- Talk to
- ATO or your tax agent
- Recurring fix
- Line of credit + tax account
Why BAS turns into an emergency
Your business activity statement bundles GST collected from customers, PAYG withholding from wages, PAYG instalments and sometimes other amounts. It lands on a set date, and for many businesses it’s the single biggest bill of the quarter.
When cash is tight, it’s tempting to pay suppliers and staff first and let the BAS slide. That works once. Then the next quarter arrives with a new BAS on top of the old one, general interest charge accruing, and ATO letters becoming firmer. That’s how many ATO debt emergencies start.
Before the due date: four steps
- Lodge on time — no matter what. Lodging and paying are separate. Late lodgement brings penalties, and if the company later receives a director penalty notice, lodgement history can determine what options are available.
- Work out what you can pay now and what’s left.
- Talk to the ATO or your tax agent about a payment plan for the balance, or more time if you’re affected by a disaster or other hardship.
- Fund the gap if a plan isn’t enough or you’d rather clear it.
Payment plan, loan or line of credit?
| Situation | Best fit | Why |
|---|---|---|
| Small one-off shortfall | ATO payment plan | Simple; interest on a small balance |
| One-off but larger, enforcement risk | Short-term loan | Clears it and stops interest accruing |
| Every quarter is tight | Line of credit | Draw for BAS, repay over following weeks |
| Several quarters behind | Loan to pay the ATO | Lump sum plus plan, or full clearance |
General interest charge incurred from 1 July 2025 isn’t tax-deductible, which makes long-running payment plans more expensive than they used to be.
Stopping the next BAS emergency
- Open a separate tax account. Each time a customer pays, move the GST portion across. Each pay run, move PAYG withholding across.
- Forecast the next BAS a month ahead, not a week.
- Match facilities to the cycle. If BAS lands before your quarter’s receipts do, a standing line of credit is cheaper than repeated emergencies.
- Talk to your accountant about whether monthly reporting would smooth the cash impact for your business.
The end-of-month page covers other bills that stack up alongside BAS.
Illustrative example: a quarterly BAS after a slow quarter
Illustrative only. A Canberra IT services firm has a $68,000 BAS due on the 28th after a quarter where two clients paid late. It has $30,000 available. The owner lodges on time, pays $30,000, and arranges a short-term unsecured loan of $40,000 for the balance rather than a plan, because she expects the late client payments within six weeks. The ATO is paid in full on the due date, and the loan is repaid when the clients pay. She then sets up a separate GST account.
What lenders need for a BAS loan
- The BAS or ATO account statement showing the amount due.
- Recent business bank statements.
- ID and ABN/ACN.
- Evidence your lodgements are up to date.
- Property details if offering security.
Existing ATO debt is considered case by case.
What does a BAS actually include?
Understanding what’s in the bill helps you plan for it. Depending on your business, an activity statement can include:
| Component | What it is | Whose money is it really? |
|---|---|---|
| GST | Tax collected from customers, less GST credits on purchases | Collected on the ATO’s behalf |
| PAYG withholding | Tax withheld from employees’ wages | Withheld on the ATO’s behalf |
| PAYG instalments | Prepayments towards the business’s income tax | The business’s own tax |
| Other amounts | Such as fuel tax credits or wine equalisation tax | Varies |
The first two are the ones that cause trouble. They feel like business cash because they sit in the business account, but they were collected for the ATO. When they’re spent on suppliers and wages, the BAS arrives with nothing set aside — and unpaid withholding and GST are exactly the amounts a director penalty notice can make personal.
Monthly, quarterly or annual — does it matter?
The ATO sets reporting cycles based on factors such as turnover, and some businesses can choose to report more often. Monthly reporting means smaller, more frequent bills; quarterly means larger, less frequent ones. Neither is better for everyone. If quarterly BAS bills keep turning into emergencies, ask your accountant whether a different cycle, or at least setting aside tax weekly, would smooth the impact. A line of credit sized to one quarter’s BAS is another common fix.
Pay on time this quarter
Start a 60-second enquiry a week or two before the due date if you can see a shortfall coming.
There’s no credit check when you first enquire, and your details won’t be sent to a long list of lenders — one specialist reviews them and calls you. Accurate figures on the BAS, what you can pay and any existing ATO debt let us suggest the right structure first time. See if you qualify.
Frequently asked questions
Should I lodge my BAS if I can't pay it?
Yes. Lodging on time avoids failure-to-lodge penalties and keeps your reporting up to date, which matters for director penalty outcomes and for future lending.
When is my BAS due?
It depends on whether you report quarterly or monthly and whether you use a tax agent. The ATO publishes due dates for each period.
Can I get an ATO payment plan for BAS?
Often, yes. The ATO offers payment plans, and some can be set up online. General interest charge applies to the outstanding amount.
Is it better to borrow or take a plan?
For a small, one-off shortfall, a plan may be fine. If ATO debt is building, enforcement is likely, or you want to stop interest accruing, a loan may make more sense.