Tax Administration: 2022-2023 Federal Budget Summary

PAYG instalment systems to be modernised

Companies will be able to choose to have their PAYG instalments calculated based on current financial performance, extracted from business accounting software, with some tax adjustments.

The government will consult with affected stakeholders, tax practitioners and digital service providers to finalise the policy scope, design and specifications of this measure.

Subject to advice from software providers about their capacity to deliver, it is anticipated that systems will be in place by 31 December 2023, with the measure to commence on 1 January 2024, for application to periods starting on or after that date.

Source: Budget Paper No 2, p 21.

Reporting of taxable payments reporting system data

Businesses will be allowed the option to report taxable payments reporting system data (via accounting software) on the same lodgment cycle as their activity statements.

Subject to advice from software providers about their capacity to deliver, it is anticipated that systems will be in place by 31 December 2023, with the measure to commence on 1 January 2024, for application to periods starting on or after that date.

Consultation with affected stakeholders, tax practitioners and digital service providers will take place to finalise the policy scope, design and specifications of the measure.

Source: Budget Paper No 2, p 28.

Digitalising trust and beneficiary income reporting and processing

Trust and beneficiary income reporting and processing will be digitalised, by allowing all trust tax return filers the option to lodge income tax returns electronically, increasing pre-filling and automating ATO assurance processes.

The measure is proposed to commence from 1 July 2024, subject to advice from software providers about their capacity to deliver.

Source: Budget Paper No 2, pp 18–19.

Enhanced sharing of STP data

IT infrastructure will be developed to allow the ATO to share single touch payroll (STP) data with state and territory revenue offices on an ongoing basis.

The government will commit $6.6 million for this measure. Funding has already been provided for by the government. The funding will be deployed following further consideration of which states and territories are able and willing to invest in their own systems and administrative processes to pre-fill payroll tax returns with STP data, to reduce compliance costs for businesses.

Source: Budget Paper No 2, p 172.

ATO Tax Avoidance Taskforce to be extended

The ATO will be given funding to extend the operation of the Tax Avoidance Taskforce by 2 years to 30 June 2025.

The taskforce was established in 2016 to undertake compliance activities targeting multinationals, large public and private groups, trusts and high wealth individuals. The taskforce also scrutinises specialist tax advisors and intermediaries that promote tax avoidance schemes and strategies.

The ATO’s total resourcing requirement, including for the delivery of the extension of the Tax Avoidance Taskforce, will be settled as part of the independent review of the ATO’s ongoing resourcing requirement announced as part of the 2021–22 MYEFO measure titled Australian Taxation Office – continuation of compliance programs and independent resourcing review.

Source: Budget Paper No 2, p 29.

Deferral of 2019 Budget measure on Australian Business Numbers

The start date of the 2019–20 Budget measure requiring holders of Australian Business Numbers (ABNs) with an income tax return obligation to lodge their income tax return and to confirm their ABN status annually, will be deferred by 12 months to assist with integration into the Australian Business Registry Services (ABRS).

Source: Budget Paper No 2, p 18.

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About the Author: David McKeller

David McKellar is a Chartered Accountant and Director of Allied Business Accountants, an accounting firm specialising in providing strategic advice and taxation services to business owners, investors and Self Managed Superannuation Funds.