Everyday bookkeeping mistakes (even bookkeepers make them)

Mistakes everyone makes

• One bank account for everything. Mixing personal and business spending makes every transaction a judgement call. Open a separate business account.
• Leaving it all until BAS time. Three months of unreconciled transactions is where errors hide. Reconcile weekly; it takes minutes.
• Trusting the software's suggestions. Bank rules and auto-coding are only as good as the first time they were set up, and one wrong rule repeats the mistake hundreds of times.
• Claiming GST on things that don't have it: bank fees, interest, wages, super, ASIC fees, council rates, residential rent, and suppliers who aren't registered for GST.
• No tax invoice. For purchases over $82.50 (including GST) you need a valid tax invoice to claim the GST, and you must keep records for five years. A photo on your phone counts.
• Loan repayments coded as an expense. Only the interest is deductible; the rest is paying back the loan.
• Counting expenses twice: entering the bill, then also coding the bank payment as an expense instead of matching it to the bill.
• Owner's drawings recorded as wages or business expenses. Money you take out for yourself isn't a business cost (for sole traders and partnerships).
• Equipment coded as an expense, or small items as assets. It changes how and when the deduction is claimed.
• Spending the GST. GST you collect belongs to the ATO. Move it, and money for PAYG instalments, into a separate account as it comes in.
• Claiming 100% of the car without a logbook. Without one, the ATO can cut your claim back.
• ATO payments coded as an expense. Paying your BAS clears a debt; it isn't a cost. PAYG instalments are prepaid tax, and income tax itself isn't deductible.
• Recording sales after fees. Square, Stripe, Uber and marketplaces pay you the net amount. Record the full sale and the fee separately, or you understate income and miss the deduction (and get the GST wrong).
• Coding your own money as income. Money you put into the business, or a loan, isn't a sale. Code it as income and you pay tax and GST on your own money.
• Cash sales that never make it into the books.
• Mixing up cash and accrual. Cash basis counts sales and expenses when money moves; accrual counts them when invoiced or billed. Run your BAS on one basis when you're registered for the other, and the GST is wrong. Most software lets you switch the basis on every report, so check it each time.
• Using the wrong report. The BAS should come from the GST or activity statement report, not the profit and loss. Check the date range, and remember profit isn't the same as money in the bank: loan repayments, drawings, GST and new equipment all use cash without showing as expenses.
• Old unpaid invoices left sitting there. Chase them or write off genuine bad debts before 30 June, so you can claim back the GST and the deduction.

Mistakes bookkeepers make too

• Lodging a BAS without reconciling every account first: bank, credit cards, loans, and clearing accounts like PayPal, Square and Stripe.
• Changing transactions in a period that's already been lodged. The books no longer match what the ATO has. Lock periods after each BAS, and fix errors as an adjustment in the next one.
• Dumping things in 'general expenses' or a suspense account and never clearing it.
• Getting overseas subscriptions and ads wrong. Whether GST applies to Facebook, Google or software subscriptions depends on whether your ABN was given to the supplier. Check the invoice, not the bank line.
• Payroll errors: super on the wrong pay items, allowances set up wrongly in Single Touch Payroll, or leave not accruing. From 1 July 2026, under Payday Super, super has to be paid with every pay run, not quarterly.
• No notes. An unusual transaction with no explanation means questions (and time) at year-end.
• Doing your BAS without being registered. Anyone charging a fee to prepare or lodge your BAS must be a registered BAS or tax agent. You can check them on the Tax Practitioners Board register.

Simple habits that prevent most of it

• A separate bank account and card for the business.
• Reconcile every week, not every quarter.
• Snap every receipt as you get it.
• Put GST and tax money aside in its own account.
• Lock each period once the BAS is lodged.
• Review your coding with us once a year, or before your first BAS on new software. It's far cheaper than fixing a year of errors.

Already in a mess? It happens more than you'd think. Book a consult and we'll work out the quickest way to get your books (and your BAS) back on track.