• flexible payment arrangements
• remission of general interest charges (GIC) where appropriate
• GIC-free payment arrangements for activity statement debts (in some cases up to 12 months)

These arrangements are aimed at helping small businesses that have a good history of meeting their tax lodgement and payment obligations but are experiencing short-term financial difficulties.

Please contact us on (07) 5549 2770 for additional information or eligibility.

The information sheet says that property developers who try and avoid declaring tax on the sale of property are more likely than ever to be contacted by the ATO.

The ATO is matching information provided on Business Activity Statements and income tax returns with information from the Office of State Revenue and Land Titles Office to ensure property developers are correctly reporting GST and income tax (including CGT) on property sales.

In a recent case, a taxpayer was identified as a developer of subdivisions who purchased rural farmland and then subdivided it into residential lots.  Through data matching, the ATO identified over 100 sales made by the taxpayer.

The taxpayer had not reported the property sales and was charged the highest penalty applicable – amounting to approximately $4.5 million.

Our office is currently closed. Trading will resume on 10 January 2011.

• super guarantee contributions; and
• industrial agreement (award) super contributions.

RESCs should only include additional super contributions made by an employer, for example, super contributions made on behalf of an employee under a salary sacrifice arrangement.

Employees

Employees who have compulsory super amounts incorrectly included on their payment summaries should notify their employer to provide them with an amended payment summary.

Please contact us if you think your employer may have included incorrect amounts on your payment summary.

Employers

Employers that have issued payment summaries to their employees that incorrectly include compulsory super amounts should notify any affected employees about the error and issue them with amended payment summaries.

If these employers have already lodged their payment summary annual report with the ATO, they will need to lodge an amended annual report.

The data identifies members of online selling sites who are involved in selling goods and services of a total value greater than $20,000 in any of the past three financial years: 2007/08, 2008/09 and 2009/10.

This data is electronically matched with the ATO’s own data, and the ATO will contact individuals and businesses that they identify as being at risk of running part of their business off the books, or in other ways not reporting all their income, to encourage them to make a voluntary disclosure of any under reported amounts.

The majority of letters will be sent to businesses reporting outside the ‘small business benchmarks’ for their industry.

The ATO claims that their small business benchmarks (which they have developed for over 100 industries) help them to identify businesses that may be avoiding their tax obligations by not reporting some or all of their income.

The letters inform taxpayers that they have been identified as a result of one of the ATO’s cash economy indicators, and will encourage them to review their records to ensure they have correctly reported all income, especially cash transactions.

In addition, the ATO warns that businesses that fall within the benchmarks should not assume that they are safe from an ATO audit or review.

The benchmarks complement the ATO’s recently expanded data matching program, and they also use other sources of information to identify those not meeting their tax obligations, including information from other government agencies, trade suppliers, tax returns and activity statements and allegations of tax evasion sourced from the community.

If you receive a letter from the ATO, contact us so that we can assist you to review your records, returns and income, and to advise the ATO if a mistake has been made.

• a 12 month general interest charge free payment arrangement with the Tax Office; and
• a deferral of activity statement payment due dates.

If you need to send us documents, please email them instead.

Our small business benchmarks program . . . continues to expand. We have now benchmarked the key business ratios of over 100 different businesses. We use the benchmarks to identify businesses that may be avoiding their tax obligations. We have recently begun sending letters to approximately 1,000 businesses that are reporting income that is significantly outside of the benchmarks. These businesses will be advised that they are required to meet their obligations and/or provide us with records to support the income declared. Where they do not fulfil these requirements we will raise a default assessment based on the information available to us through the benchmarks.

He stated that tax agents should try to ensure that their clients are reporting within the benchmarked ratios or can substantiate their results when they report outside of them.

Editor: If you receive a letter from the ATO along these lines, make sure you speak to us first before replying!