By All Accounts

Tax returns & ATO debt management

Happy New (fi nancial) Year! While unlikely at the top of anyone’s todo list, getting ready to have your income tax returns prepared and lodged should be high on the agenda early in the new year.

Liaise with your accountant to book in a time to have your returns prepared and if unsure request a list of information they will need to get started. Even if returns and tax bills are not due for some time, it’s always easier to compile information soon aft er the period end whilst transactions are fresh in your mind and before documents fall further down the pile and harder to fi nd when required. Your accountant can prepare your returns, let you know your tax liabilities but hold for lodgement until later in the year to allow you to access later due dates for payment if required. Get the monkey (your accountant) off your back and tick that task off your list earlier and focus on the year you are in.

Lodgement due dates

Where your returns are lodged by a registered tax agent and your group has less than $10 million in annual total income, the due dates for lodgement are as follows:

October 31, 2022

Individuals, trusts and companies with one or more outstanding prior year return as of June 30, 2022

March 31, 2023

Individuals and trusts whose latest return resulted in a tax liability of $20,000 or more. Companies with a total income of more than $2 million in the 2020-21 fi nancial year

May 15, 2023

lodge earlier and not eligible for the June 5 concession. The concession allows these tax returns to be lodged by June 5, 2023, without penalty, provided that any payment required is also made by this date. This is a concessional arrangement where penalties will be waived if lodgement is made by this date.

Lel Parnis, Principal, Holmans

Payment due dates

There are staggered payment due dates for individuals and trusts with a May 15, lodgement deadline depending on when the return is lodged: • Return lodged on or before February 12, 2023, Tax payment due March 21, 2023

• Return lodged between February 13, 2023, and March 12, 2023, Tax payment due April 21, 2023 • Return lodged between February 13 to March 12, 2023, Tax payment due June 5, 2023

For returns not due on 15 May, the payment due date is generally 21 days from the lodgement due date. The payment dates above are the earliest possible due dates for payment of tax and provide at least two weeks for processing by the ATO. If processing of a tax return takes longer than this, the actual due date for payment on the notice of assessment will be later than the dates indicated above. Always refer to your actual Notice of Assessment or check with your accountant to confi rm due date if uncertain to avoid late payment penalties and/or interest charges.

Get the monkey (your accountant) off your back and tick that task off your list

Get up to date

The ATO’s activity on outstanding tax lodgements and payments is increasing. Various options are available to taxpayers and tax and BAS agents when it comes to managing your obligations. The past two years has been extraordinarily challenging, and many small business owners may have found themselves in unfamiliar waters. Some may have fallen behind in their lodgements and/or owe a tax debt for the fi rst time. Others with existing tax debts may fi nd themselves deeper in debt than before the pandemic. The ATO Commissioner’s Annual Report 2020–21 explains that, given the signifi cant impact of the pandemic on the community, the ATO adjusted their debt collection approach in three phases to enable taxpayers to get back on track, essentially aiming to increase communication between the ATO and taxpayers to assist with meeting lodgement and payment obligations. Hiding from the taxman is not the way to go if you want to seek remission of interest and penalties. If you have outstanding lodgements, contact your accountant, and set a timeline to work together to get everything up to date so they can seek an extension for the 2022 tax return lodgements (October 31 if no extension approved) to avoid additional late lodgement penalties.

Interest-Free Payment Plans

Small businesses with an annual turnover of less than $2 million and ATO debt of $50,000 or less relating to obligations less than 12 months overdue may be eligible for interest-free payment plans. During the 12-month interestfree period, the taxpayer must comply with all lodgement and payment plan obligations. Another clear indication that the ATO are willing to assist small businesses gett ing on top of ATO debt but also the importance in keeping up to date with all income tax and BAS reporting obligations, if lodgements are not made on time, any ATO payment plans (interest-free or otherwise) will default.

Even if you need more time to pay, it is important to keep lodging on time.

Disclaimer: This article contains general information only. Regrett ably, no responsibility can be accepted for errors, omissions or possible misleading statements or for any action taken as a result of any material in this guide. It is not designed to be a substitute for professional advice, as such a brief guide cannot hope to cover all circumstances and conditions applying to the law as it relates to these items.