In a recent speech to the Institute of Public Accountants (IPA) National Congress 2024, Will Day, Deputy Commissioner for Small Business at the Australian Taxation Office (ATO), outlined several key focus areas for small businesses in relation to GST and other tax matters. As the ATO strengthens its efforts to support small businesses in meeting their tax obligations, it is important to understand the evolving GST landscape and how it may impact your business.
Operating Outside the System: A Focus on Ride-Sourcing
A major area of focus for the ATO is the issue of small businesses operating outside of the GST system. Specifically, the spotlight is on the ride-sourcing sector, which includes services like taxi, limousine, or other ride-hailing services. Ride-sourcing drivers are required to register for GST regardless of their turnover. This includes not only the larger operators but also independent contractors offering their services on platforms like Uber, Lyft, or similar services.
As part of the ATO’s efforts to ensure GST compliance, the ATO will be contacting ride-sourcing drivers from February 2025 if their records suggest they may not be meeting their tax obligations. This contact may involve a request to verify their tax affairs or seek guidance to ensure their registrations and payments are correct. For those who do not respond or fail to rectify any discrepancies, stronger actions will be taken.
Aiming for a Seamless Tax Experience
In line with its broader strategy, the ATO is working towards the OECD’s Tax Administration 3.0 vision, which seeks to simplify and streamline the tax process for small businesses. The vision envisions a future where small businesses find it easier to comply with tax obligations from the outset and on time. A key aspect of this is moving businesses from quarterly to monthly Business Activity Statement (BAS) lodgments.
By adopting a more frequent lodgment system, the ATO hopes to help businesses stay on top of their obligations, preventing errors or delays that could result in penalties. This shift aims to create a smoother, more predictable experience for small businesses as they navigate their tax responsibilities.
How Boa & Co. Chartered Accountants Can Help
With the ATO increasing its scrutiny and adopting new systems, it’s more important than ever for small businesses to ensure their GST registrations and tax filings are accurate and timely. If you’re unsure whether your business is fully compliant or need assistance managing your tax affairs, Boa & Co. Chartered Accountants is here to help. Our experienced team can guide you through the complexities of GST registration, BAS lodgment, and ensure your tax affairs are in order.Get in touch with Boa & Co. today to ensure your small business stays ahead of changes in GST compliance. Call us at 1300 952 286, email us at [email protected], or visit our website at www.boanco.com.au for more information.