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ATO Tax Time Focus for Small Business



ATO Tax Time Focus for Small Business

The ATO has released a tax time tool kit to assist businesses and us as your tax advisor to nail your 2021/22 business tax return.

The ATO has also flagged what it will be focusing on for small business tax returns for 2021–22:

ATO Assistant Commissioner Andrew Watson said:
"We know it’s been a tough couple of years for many small business owners, and we understand your tax obligations may not be at the top of your list. So, if you need a hand, I encourage you to contact your registered tax professional.
No matter what your situation is, it’s never too late to ask for help. Tax time is also a great time to discuss ATO debts with your registered tax professional and set up a payment plan if you need one."

Income
Mr. Watson reminded small businesses to include all income, including earnings from ‘side hustles’. Small businesses should include all income in their income tax return, including cash, coupons, EFTPOS, online, credit or debit card transactions, and income from platforms such as PayPal, WeChat or Alipay

The ATO has also reminded businesses that most government payments or financial support received as a result of COVID-19 needs to be included as taxable income, whereas some others are exempt and should not be included. The ATO has detailed information listing how all support payments should be treated on its website. Speak to us for further guidance.

Deductions
Mr. Watson reminded businesses to only claim what they are entitled to, and that their business structure affects their entitlements and obligations. The way that sole traders, partnerships, trusts, and companies claim deductions is often different.

There are three golden rules for what the ATO accepts as a valid business deduction:

Lodgment Deadlines
Although tax returns are generally due by 31 October, because you are lodging with us (a registered agent), you will have more time to prepare and lodge. This will generally be in the first half of 2023.

If you have any questions you should contact your accountant at Forsyths for a discussion based on your personal circumstances.