Delivering his commissioner’s address at the Tax Institute’s 2021 Tax Summit, Chris Jordan acknowledged the expansion of single touch payroll comes at a busy time for practitioners. He said to combat the pressure, the Tax Office will ensure it takes a fair and flexible approach during the roll-out.
“This next phase will ease the reporting burden for employers who need to report information about their employees to multiple government departments. It will also help Services Australia customers, who might be employees, get paid the right amount at the right time,” Mr Jordan said.
“We know the start date comes at a busy time for you and some employers, so we have committed to taking a flexible approach. While the start date is 1 January 2022, given your clients will be reliant on their software providers to be able to start reporting, the first step is to check whether their software provider has been given a deferral.
“If the software is ready to go by 1 January then as long as your clients can start reporting by 1 March 2022, they will be considered to have started on time and don’t need to apply for a deferral.
“If a software provider has been granted extra time, this will apply to their customers as well. Employers can apply for individual deferrals from December this year. We will be flexible and reasonable with the transition.”
Continuing on in his speech, Mr Jordan highlighted that the ATO remains committed to ensuring it provides clear and fair advice to the tax profession going forward.
“An essential part of supporting you is providing clear advice on issues that prove challenging. We have remained focused on providing practical guidance on technical and administrative issues so you have clarity,” Mr Jordan said.
“We recognise ongoing complexities in the consistent understanding and application of Division 7A and 100A and we are working to provide more guidance. Arrangements that undermine confidence and integrity in the tax system and enable the party who receives the benefit to avoid tax on that benefit are concerning.
“The release of this guidance has been delayed in recognition of the pressure you and your clients are under. We expect to release it for public consultation in the new calendar year.”
Mr Jordan added that the ATO is also close to publishing revised guidance for professionals when considering the allocation of profits by professional firms.
“This revised guidance will address concerns around arrangements where taxpayers redirect their income to an associated entity from a business or activity which includes their professional services,” he explained.
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Emma Ryan is the deputy head of content at Momentum Media and editor of the company's legal publication, Lawyers Weekly.
Emma has worked for Momentum Media since 2015 and has been responsible for breaking some of the biggest stories in corporate Australia. In addition, she has produced exclusive multimedia and event content related to the company's respective brands and audiences.
A journalist by training, Emma has spent her career connecting with key industry stakeholders across a variety of platforms, including online, podcast and radio. She graduated from Charles Sturt University with a Bachelor of Communications (Journalism).