What is ias preparation?
The Instalment Activity Statement prepared on the same discipline as the BAS, for the months in between.
The Instalment Activity Statement exists because two different reporting clocks run inside the same business at the same time. GST, for most small and medium businesses, is reported quarterly on the BAS — 28 October, 28 February, 28 April, 28 July. PAYG withholding, the tax withheld from employee pay each pay run, has its own remittance schedule set by how much the business withholds in a year, and for a business that withholds between $25,000 and $1 million annually — a 'medium withholder' in ATO terms — that schedule is monthly, not quarterly. The IAS is what closes that gap: it is the form lodged in the two months of each quarter that don't get a BAS, carrying PAYG withholding (and PAYG income tax instalments, and FBT instalments, where the business is liable for those) with no GST on it at all.
A second group of businesses lodges IAS instead of BAS every period, not just in between: those not registered for GST at all — turnover under the $75,000 threshold, or a not-for-profit under $150,000 — but who still employ staff and withhold PAYG, or who pay PAYG income tax instalments on business or investment income. For that group the IAS is the whole reporting relationship with the ATO; there is no BAS in the picture because there is no GST registration to report.
Who does what
Prepared for your registered agent to lodge.
Who does what
| Your CapEasy team | IAS preparation, the reconciliations and reporting behind it, and the questions list that keeps it honest. |
| Your registered BAS or tax agent | Everything that carries a licence in Australia — rendered exactly as written: work out what goes on your bas, or advise you on it — under tasa 2009 that requires registration we do not hold. |
| You | One conversation with one named person, and the decisions that are genuinely yours. |
IAS preparation in Australia
The withholding threshold decides whether a business is on IAS at all, or on IAS between BAS periods
The ATO sorts PAYG withholders into three bands based on the amount withheld in the prior financial year (or expected in the current one): small withholders (under $25,000/year) report and pay PAYG withholding on their existing quarterly BAS with no separate IAS needed; medium withholders ($25,000 to $1 million/year) must remit monthly, which is what creates the monthly IAS in the two non-BAS months of each quarter; large withholders (over $1 million/year) remit electronically within days of each pay event and don't use an IAS at all. Which band a business sits in is a threshold check against actual withholding, not a choice — and it can shift a business from BAS-only to BAS-plus-IAS the moment payroll growth crosses $25,000 in annual withholding.
A monthly IAS carries no GST label, ever
The IAS form is structurally different from the BAS — it has no G1/G3-style GST fields at all, only PAYG withholding (W1, W2), PAYG income tax instalment (T1, T7 or T4/T11 depending on the option used), and FBT instalment (F1) where applicable. A business that reports GST monthly (turnover $20 million or more) files a full BAS every month instead of alternating with an IAS, because at that threshold GST itself is already on a monthly cycle — the IAS/BAS split described here only applies to the much more common quarterly-GST-cohort.
PAYG income tax instalments run on an ATO-set rate or an ATO-calculated amount, not a self-assessed figure
For instalment income reporting (option 1), the ATO issues an instalment rate calculated from the last lodged tax return, and the business applies that rate to the period's actual instalment income — get the instalment income figure wrong and the instalment itself is wrong even with the correct rate. Option 2 sidesteps that by using the ATO's own pre-calculated instalment amount instead, which removes the calculation risk but means the figure can lag badly behind a fast-growing or fast-shrinking business's real current-year income.
No agent-lodgment extension exists for monthly obligations
The extended due dates a registered tax or BAS agent can secure for a client apply to quarterly BAS lodgments, not to monthly ones. A monthly IAS is due on the 21st of the following month regardless of who lodges it, which means the calendar discipline that protects a quarterly BAS client doesn't carry over to the months in between — those dates have to be tracked on their own terms.
What your registered BAS or tax agent receives from us
- A payroll register reconciliation for the period, matched against W1 (total payments) and W2 (amount withheld) as they will appear on the IAS.
- The instalment income figure for the period (if reporting PAYG income tax instalments under option 1), reconciled against the business or sole trader's actual income for that instalment period.
- Confirmation of which ATO instalment rate currently applies, and a flag if the business is instead on the ATO-calculated instalment amount (option 2).
- An FBT instalment figure for the period, where the business carries an ongoing FBT liability.
- A month-by-month calendar showing which months in the current quarter need an IAS and which need the full BAS, built from the business's actual PAYG withholding band.
- A reconciled PAYG withholding summary tied to actual pay runs processed, ready for your registered agent to review and lodge as the IAS.
