Tax is the one bill every business knows is coming, yet it’s still the one that catches good operators off guard. The reason is simple: GST, withheld PAYG and super aren’t really your money. You collect them along the way and hold them until they’re due. Managing BAS and tax cash flow well means treating those amounts as spoken for from the moment they land, knowing exactly when each one falls due, and having a calm plan for the quarter when things are tight. Get this rhythm right and tax time becomes a non-event.
When are BAS, GST and PAYG due?
Most small businesses lodge a quarterly business activity statement (BAS), which is the form you use to report and pay GST, PAYG withholding and PAYG instalments. Here are the standard dates from the ATO.
| Quarter | Period | Due date |
|---|---|---|
| Q1 | July–September | 28 October |
| Q2 | October–December | 28 February |
| Q3 | January–March | 28 April |
| Q4 | April–June | 28 July |
A few things to know:
- Monthly BAS is due on the 21st of the following month. It applies if your GST turnover is $20 million or more, or if the ATO has asked you to report monthly. Some smaller businesses choose it voluntarily to keep amounts bite-sized.
- Weekends and public holidays: if a due date falls on one, you have until the next business day.
- Extra time: lodging online, or through a registered tax or BAS agent, can give you extra time for some quarters. Q2 doesn’t get a further extension because it already includes one.
PAYG withholding and PAYG instalments
- PAYG withholding is the tax you hold back from employees’ wages. If you withhold $25,000 or less a year, you’re a small withholder and pay quarterly with your BAS. From $25,001 to $1 million, you’re a medium withholder and pay monthly.
- PAYG instalments are prepayments of your own business’s income tax, usually paid quarterly. You can vary them if your income is tracking well below last year’s.
What changed with super? Payday Super explained
From 1 July 2026, super guarantee contributions follow each payday instead of each quarter. Under Payday Super:
- Contributions must be received by the employee’s super fund within 7 business days after the day you pay wages.
- For a new employee’s first contribution, the window is 20 business days.
- The super guarantee rate remains 12%, now calculated on “qualifying earnings”.
- The ATO’s Small Business Superannuation Clearing House closed on 1 July 2026, so employers who used it have moved to other payment methods.
- Late payments attract the super guarantee charge.
For cash flow, this is a genuine shift. Instead of one large super payment each quarter, you now have smaller, more frequent payments tied to your pay cycle. Many owners find this easier to manage because the money never has time to be “borrowed” by the business. Just make sure your forecast reflects the new rhythm.
How much tax should I set aside, and how?
The simplest system is a separate tax account. Every week (or every time a big payment lands) move money across so it’s never mixed with operating cash.
| Obligation | How much to move across | How often |
|---|---|---|
| GST | One-eleventh of taxable sales minus one-eleventh of taxable purchases | Weekly |
| PAYG withholding | The tax withheld from each pay run | Each payday |
| Super | Pay the contribution itself with each pay run | Each payday |
| PAYG instalments | Your quarterly instalment ÷ 13 | Weekly |
| Income tax balance | A share of profit agreed with your accountant | Monthly |
The ATO itself recommends putting GST aside as you collect it, and suggests a separate account for the purpose. If your turnover is steady, the GST instalment method (paying a set amount each quarter based on last year) can make BAS completely predictable.
Why does ATO interest cost more from 1 July 2025?
Because it’s no longer tax-deductible. The general interest charge (GIC), which applies to overdue tax, and the shortfall interest charge (SIC), which applies when an amended assessment increases your tax, are not deductible for any amount incurred on or after 1 July 2025. That applies even if the underlying debt is from an earlier year. Amounts incurred before that date remain deductible for 2024–25 and earlier years.
In plain terms, the after-tax cost of letting an ATO debt run has gone up. The ATO’s own advice to small businesses is to pay as soon as you can and keep any payment plan as short as possible.
Short on a BAS payment? A decision guide
If a BAS payment is going to be tight, work through these questions in order.
- Can you lodge on time anyway? Always lodge, even if you can’t pay in full. Lodging keeps your options open and avoids failure-to-lodge penalties.
- Is it a timing gap or a bigger problem? If customers owe you money that will arrive within weeks, the fix is about timing. If the business has been under-reserving for months, the fix is about habits as well as funding.
- Could an ATO payment plan work? If you owe $200,000 or less, you may be able to set one up yourself in the ATO’s online services. Interest continues to accrue while you pay it off.
- Would business finance work better? Compare the options side by side (below), and have a quick chat with your accountant about the tax treatment of each.
- Whatever you choose, act early. Contacting the ATO before the due date, or arranging finance before the debt grows, keeps far more doors open.
| ATO payment plan | Business finance | |
|---|---|---|
| Set-up | Online for debts up to $200,000; otherwise contact the ATO | Online enquiry; decision in as little as 4 hours with FastBiz Loans |
| Cost | GIC accrues on the balance and isn’t deductible from 1 July 2025 | Priced on your business’s situation; ask your accountant about the tax treatment |
| Effect on the ATO relationship | Shows you’re engaging; a kept plan avoids debt reporting | Clears the ATO debt in full |
| Effect on cash flow | Instalments on top of future BAS obligations | Repayments matched to your cash flow; product choice matters |
| Best when | The gap is modest and your cash flow can absorb the instalments | The gap is a timing issue, or you want a clean slate with the ATO |
Neither is always right. What matters is picking deliberately rather than drifting into arrears.
Example scenario — illustrative only. A Newcastle building contractor had a strong October–December quarter on paper, but two large progress claims were still unpaid when the 28 February BAS came due. Rather than let the debt sit with the ATO, she used invoice finance on the outstanding claims to pay the BAS on time, then built a separate GST account so the next quarter wouldn’t depend on customer timing.
Which FastBiz Loans products help with tax cash flow?
- A business line of credit suits businesses whose tax bills and receipts don’t line up neatly. Draw for BAS, repay as income arrives, and use it again next quarter.
- A small business loan can clear a one-off lump, such as a large year-end tax bill, with same-day funding possible.
- Invoice finance releases up to 85% of unpaid invoice value, which helps when tax is due before customers pay.
Our working capital loans page compares them. If a tax debt has already been reported, read how to improve your business credit score, and plan the year ahead with our seasonal cash flow planning guide.
Make tax time boring
The goal isn’t to become a tax expert. It’s to make BAS so routine that you barely notice it: money set aside weekly, dates in the calendar, super paid with wages, and a plan ready for the quarter that doesn’t go to script. If you’d like a funding option lined up before your next BAS, start a 60-second enquiry. It doesn’t affect your credit score, and a lending specialist will talk you through what fits.
Questions we get asked
When is my quarterly BAS due?
For most small businesses lodging themselves, quarterly BAS is due on 28 October, 28 February, 28 April and 28 July. If a due date falls on a weekend or public holiday, you have until the next business day. Lodging online or through a tax or BAS agent can give you extra time for some quarters.
How much GST should I set aside?
The ATO's rule of thumb for businesses whose sales are mostly taxable is one-eleventh of your sales minus one-eleventh of your purchases. Moving that amount into a separate account each week means the money is there when BAS is due.
What changed with super on 1 July 2026?
Payday Super started. Employers now pay super guarantee contributions with each pay run, and they must be received by the employee's fund within 7 business days of payday, with a longer 20 business days for a new employee's first contribution. The old quarterly deadline no longer applies.
Is ATO interest still tax-deductible?
No, not for charges incurred on or after 1 July 2025. General interest charge (GIC) and shortfall interest charge (SIC) incurred from that date aren't deductible, even if the debt relates to an earlier year. Charges incurred before 1 July 2025 can still be claimed for 2024–25 and earlier years.
Should I use a business loan to pay a tax debt?
Sometimes it makes sense, sometimes a payment plan is better. Compare the total cost, the repayment rhythm and what each option does for your cash flow, and have a quick word with your accountant. The worst option is usually doing nothing, because debts and charges keep building.
Can a tax debt affect my business credit?
It can. The ATO may report a business tax debt to credit reporting bureaus when at least $100,000 is overdue by more than 90 days and the business isn't engaging with the ATO. Businesses that are actively managing their debt, such as by keeping to a payment plan, aren't reported.