A loan to pay BAS is business funding used to clear the amounts on an overdue business activity statement: GST, PAYG withholding and PAYG instalments, and often a super guarantee balance alongside them. The first job is to lodge so the ATO figure is real. The second is to choose how to pay it, and a loan is one way to do that in a single transaction.
This page covers the obligations behind a BAS debt. For the loan mechanics, read loans for tax debt; for the overview, see tax debt loans.
What does a BAS actually report?
A BAS reports the tax amounts your business has to settle with the ATO for a period. The ATO’s BAS page lists GST, PAYG withholding and PAYG instalments as the main items, with fringe benefits tax, luxury car tax, wine equalisation tax and fuel tax credits on the form for businesses that need them.
Here is what each part means in practice:
| Item | What it is | Who it hits |
|---|---|---|
| GST | GST charged on sales, less credits for GST paid on purchases | Businesses registered for GST |
| PAYG withholding | Tax withheld from employee pay and other payments | Businesses with employees or payees |
| PAYG instalments | Advance payments toward your own income tax | Businesses that earn assessable income |
| Super guarantee | Super contributions for employees, paid to funds | Employers; reported separately to the BAS |
Super is paid to employees’ funds each quarter rather than on the BAS, but the ATO treats an unpaid super debt in the same family of problems. When super is late, it becomes a super guarantee charge (SGC) debt, described below.
When are BAS payments due?
Monthly lodgers lodge and pay by the 21st of the month after the period ends. Quarterly lodgers use a fixed calendar: 28 October for July to September, 28 February for October to December, 28 April for January to March, and 28 July for April to June. The ATO notes that online lodgers can get an extra concession on some quarters, so check the date printed on your own statement.
The reporting cycle for PAYG withholding follows how much you withhold. The ATO sets small withholders at $25,000 or less a year (quarterly), medium withholders at more than $25,000 up to $1 million (monthly), and large withholders pay within days of a withholding event. Your cycle is shown in your ATO account.
GST registration is required once GST turnover reaches $75,000 or more. From then on, GST is reported on the BAS.
What should you do first if you cannot pay a BAS?
Lodge anyway, and contact the ATO as soon as possible. The ATO’s guidance for businesses that cannot meet a due date says exactly that: contact it early, and lodge on time because that keeps your information up to date. GIC applies to any amount not paid by the due date, so a quick payment arrangement limits what builds up.
Lodging does two jobs. It tells the ATO your real liability, and it gives any lender a number to work with. An unlodged BAS leaves everyone guessing, and guessing in tax is expensive.
How does a loan to pay BAS, GST and PAYG debt work?
A loan clears BAS debt by paying the full balance in one transaction. The funds go to the ATO using the payment details on your account, and the overdue amounts and GIC stop growing.
The process is straightforward:
- Lodge all outstanding BAS and note the ATO balance by account.
- Decide what the loan must cover: tax, GIC, penalties, and perhaps an upcoming BAS.
- Apply with the balance, the security or bank statements, and your plan for the next quarter.
- Sign, have the ATO paid directly, and confirm the account.
Property-secured funding commonly runs from $20,000 to $5,000,000 and can be possible within 24 hours in some approved scenarios. Unsecured funding commonly runs from $5,000 to $500,000 and is sized on turnover and bank statements. Which one suits you depends on size, speed and whether you hold property. Start the application once you have lodged.
What about unpaid super guarantee?
Unpaid super becomes a super guarantee charge, and the charge costs more than the super alone. The ATO says the SGC is made up of the super guarantee shortfall, nominal interest and an administration fee, it is more than the super you would have paid, and it is not tax deductible. The nominal interest cannot by law be reduced or waived.
Timing matters too. The ATO’s quarterly super due date is the 28th of the month after each quarter, and the SGC statement is due a month later. The ATO’s advice on a missed payment is to lodge the SGC statement by its due date even if you cannot pay in full, and it will work with you on a payment plan. For companies, directors face a penalty equal to the unpaid SGC if it is not paid, which is covered in director penalty notice loans.
Super debts are often the strongest reason to borrow: the charge is not deductible, the interest is fixed and employees are waiting. A loan can clear the shortfall and nominal interest in one go.
What do lenders want to know about a BAS shortfall?
Lenders want to know why it happened and whether it will happen again. The honest answers are usually one of these:
- A slow quarter. Revenue dipped, wages and rent did not.
- Late customer payments. A big debtor delayed, and tax was paid from the money meant to cover GST.
- A one-off cost. Equipment, a legal bill or a staffing change used the cash.
- A habit. GST has been used as working capital for a while.
The first three are recoverable and read well. The fourth needs a fix alongside the loan, such as a separate tax account or weekly transfers. If cash flow is the underlying problem, working capital loans look at how to size funding to the real cycle, and unsecured business loans explain how limits are set.
Illustrative example: a quarter of GST and withholding
Illustrative example: a hospitality group lodges four overdue BAS and finds it owes $175,000 in GST and PAYG withholding, with a super guarantee shortfall on top. A major customer paid late and the group used the tax money for wages. The owner holds an investment property with strong equity.
A $200,000 first-ranking private loan on the investment property is arranged. $175,000 clears the BAS balances, the rest covers the super shortfall and costs. The group opens a separate account, moves a share of GST in each week, and lodges on time for the next four quarters. The numbers are invented and round.
How do you keep the next BAS from becoming a debt?
Set the tax aside when the money arrives, not when the BAS does. A separate bank account for GST and withholding, topped up on every invoice or pay run, turns the due date into a transfer instead of a crisis. Review the account each month against what your accounting software says you owe.
If cash is tight because customers pay late, fix that source too: shorter payment terms, deposits up front, or invoice financing to release money tied up in unpaid invoices. A loan that clears the debt works best when the habit changes alongside it.
Which route suits a BAS debt: loan, plan or both?
For smaller debts and steady cash flow, an ATO plan may do. For larger debts, near-term deadlines or an unaffordable plan, a loan is stronger. The decision guide on ATO payment plan versus business loan sets out the comparison, including the small business plan for overdue BAS where GIC is remitted.
If you are close to the 90-day, $100,000 credit-reporting line, treat the timing as part of the decision. The ATO gives 28 days’ notice, and keeping to a payment plan counts as engaging.
Ready to clear the BAS?
Lodge what is overdue, collect your balance by account and put it in front of us. The quick application takes minutes and asks for the amounts, any property security and your repayment plan. Apply for BAS debt funding or call 03 4059 1829, and we will help match you with a route that fits.