You’ve got overdue BAS and not enough cash to clear the bill. The ATO late lodgement penalty isn’t a reason to wait: lodge every overdue BAS now, even if you can’t pay.
The ATO’s penalty is $364 for every 28 days, or part of 28 days, that a BAS is late, up to $1,820 a BAS. If your GST turnover is over $1 million and under $20 million, it doubles, to $3,640 a BAS.
Lodging and paying are separate. Waiting for a better trading week makes the penalty grow and, if you run through a company, narrows your options on a director penalty. The ATO also expects every overdue document lodged before you ask it to drop a penalty.
Can You Lodge BAS If You Can’t Pay?
Yes, you can lodge your BAS without paying the amount owing, and that’s what we’d do first.
Don’t leave a completed BAS sitting with your bookkeeper while you wait for enough money to cover it. Get it lodged, then work through the payment arrangement.
Start with this checklist:
- Check which BAS are outstanding and the due date for each.
- Gather your POS sales reports, supplier invoices, bank feeds and pay runs for each quarter.
- Give your registered tax or BAS agent anything missing from the file.
- Lodge every overdue BAS, including any with nothing to report.
- Keep the lodgment confirmations and check what’s still outstanding.
- Separate the tax debt from any penalty or interest already charged.
When we take over a file, one of the first things we check is whether every pay run was filed through STP. Sometimes they weren’t, for months, and STP reports are on the same ATO list of documents that can attract this penalty.
A BAS with nothing to report still needs to be lodged as nil. Generally, the ATO won’t issue a late lodgment penalty notice for a nil or refund BAS, unless it applied the penalty before lodgment or you’re a large withholder.
Check the real due date for each quarter. Lodging online or through a registered agent can give extra time, but not for the October to December BAS, which covers Christmas trading and is due 28 February. Our BAS due dates article explains the deadlines.
If you’re handling it yourself, use the ATO’s instructions to lodge your BAS. Also check for overdue tax returns, which can attract the same penalty.
How Much Is the ATO Late Lodgement Penalty?
The base failure to lodge penalty is one penalty unit for every 28 days, or part of 28 days, that a document is overdue, up to 5 units per document.
For infringements on or after 1 July 2026, a penalty unit is $364.
The base amount doubles if any of these applies:
- You’re a medium withholder in the month the document was due.
- Your assessable income for the income year in which it was due is more than $1 million but less than $20 million.
- Your current GST turnover in the month it was due is more than $1 million but less than $20 million.
A medium withholder withholds more than $25,000 but less than $1 million during an income year. That’s tax withheld, not your sales. You only need to meet one of the doubling tests.
The ATO counts the penalty period from the document’s due date to the day before it receives it. Use the due date that applied, including any extension.
A Restaurant With Two Overdue BAS
Take a restaurant turning over $25,000 a week excluding GST, about $1.3 million a year. That’s over the $1 million line, so its penalty is doubled.
Both BAS were due after 1 July 2026, so the $364 unit applies.
| Step | Working | Result |
|---|---|---|
| Count the periods for BAS 1 | 100 days late reaches the fourth 28-day period | 4 units |
| Calculate the BAS 1 penalty | 4 x $364 x 2 | $2,912 |
| Count the periods for BAS 2 | 20 days late is part of the first 28-day period | 1 unit |
| Calculate the BAS 2 penalty | 1 x $364 x 2 | $728 |
| Add the two penalties | $2,912 + $728 | $3,640 |
If the ATO applies the penalty, this restaurant pays $3,640 on top of the BAS debt itself, out of the cash from a $25,000 trading week.
At the base rate, the maximum is $1,820 per document. With the doubled rate, it’s $3,640 per document.
You can’t claim a tax deduction for penalties the ATO imposes.
Will the ATO Waive a Late Lodgement Penalty?
The ATO can remit all or part of the penalty, but it expects you to lodge your outstanding documents before requesting remission.
Generally, it doesn’t apply penalties in isolated cases of late lodgment. The ATO says it will warn you by phone or in writing and issue a notice to lodge before applying a failure to lodge penalty.
That isn’t a reason to wait for a reminder. If a penalty notice arrives, it will give the reason, amount and payment due date, which must be at least 14 days after the notice.
Reasons the ATO Is More Likely to Accept
The ATO lists circumstances including:
- Severe illness affecting your registered agent, you or someone you care for.
- Not receiving information you needed from other parties.
- A disaster such as fire or flood.
- Financial abuse, coercive control or family violence.
Your request needs to connect the event to the delay. Explain what happened, how it stopped you lodging, whether it was beyond your control and why you or your agent couldn’t ask for more time.
Reasons the ATO Is Likely to Decline
Its list includes:
- Being on holiday.
- Being busy with work commitments.
- A short, non-severe illness such as a cold.
- Not receiving ATO reminders.
- Still not having lodged the document.
Being flat out at the venue is real, but it’s not a strong remission reason on its own. Describe what happened rather than trying to make a busy season sound like something else.
Businesses can use the relevant form through online services, phone or mail. Follow the ATO’s steps to request remission of a failure to lodge penalty.
Phone requests involving more than $2,500 are escalated to a dedicated team, so you won’t receive an immediate decision.
What If Your Bookkeeper Was Supposed to Lodge?
You may qualify for safe harbour if you engaged a registered tax or BAS agent and gave them everything needed to lodge on time.
Under safe harbour, you aren’t liable for the penalty if both of these apply:
- You can show that you gave the registered agent all relevant tax information so they could lodge by the due date.
- Their failure to lodge wasn’t due to recklessness or intentional disregard of the tax law.
Check who was responsible for lodging and whether they were a registered tax or BAS agent. Having someone called a bookkeeper isn’t, by itself, enough to establish safe harbour.
Keep the emails, document uploads and other records showing what you supplied and when. Also keep requests for missing information and your replies.
If your bookkeeper has left, the same two conditions still decide it. Get the overdue BAS lodged now, and gather those records at the same time.
Can Late BAS Make You Personally Liable?
Yes, if you run through a company, unpaid GST and PAYG withholding can lead to director penalties, and late reporting can remove options for remitting them.
If those amounts are reported within 3 months of the due date, a director penalty can be remitted within 21 days of the notice being issued through:
- Paying the corresponding company liability in full.
- Appointing an administrator.
- Appointing a small business restructuring practitioner.
- Beginning to wind up the company.
If the amounts are reported more than 3 months late, or remain unreported after 3 months, paying the corresponding company liability in full is the only way to remit that director penalty. ATO estimates count as amounts that were never reported.
That’s why we wouldn’t leave a company BAS in draft while you find the money. The 3-month clock runs on reporting, not paying.
If a director penalty notice has arrived, deal with it the same day. Our director penalty notice article explains your options, and some of them need an insolvency adviser or lawyer.
How Do You Catch Up Without Falling Behind Again?
Lodge what’s overdue, work out a payment arrangement you can keep, and put money aside for the next BAS while you clear the old debt.
You need to pay the BAS in full and on time to avoid the ATO’s general interest charge, or GIC.
If you owe $200,000 or less, you may be able to set up a payment plan through ATO online services. Plans require an up-front payment.
If the next BAS is looking hard to lodge or pay, contact the ATO or your registered tax professional before the due date.
Before proposing repayments, check what your venue can spare after wages, suppliers and current tax commitments. Don’t build the plan around your best trading week. Our article on defaulting on an ATO payment plan covers the next problem you want to avoid.
Roger’s hospitality accounting includes weekly bookkeeping and a BAS put-aside figure on every weekly report. Our ATO debt help comes with a package and costs clients nothing extra: we get overdue BAS, IAS and STP lodgments up to date and negotiate the payment plan with the ATO for the venue.
Key Takeaways
- Lodge every overdue BAS now, even if you can’t pay the debt yet.
- Check each BAS’s due date, and whether your penalty doubles because your turnover is between $1 million and $20 million.
- Lodge outstanding documents before requesting remission, and explain the specific event that caused the delay.
- Check safe harbour if a registered agent had all the information needed to lodge on time.
- If you run a company, report GST and PAYG withholding within 3 months of the due date, even if you can’t pay, so you keep every option on a director penalty.
- Build repayments around cash your venue can spare while putting money aside for the next BAS.
If you’d like help with catching up overdue BAS and dealing with the ATO, you can reach us at (02) 9768 5922 or enquiries@getroger.com.au for a free, no-obligations chat.