Treasurer Joe Hockey has now formally announced the new tax return system, saying the “new and simpler” regime will be in place from July 1 this year.
MyTax will mean that millions of Australian taxpayers will no longer need to complete a full tax return; instead they will only need to review or change pre-filed information before lodging.
Speaking to AccountantsDaily, Mark Chapman, head of taxation products and services at Taxpayers Australia, said that while MyTax might be good for individuals, it is going to cost accountants a lot of clients.
“Assuming it works properly, it will make life a great deal easier for those ordinary tax payers with simple tax affairs. [However], on the other side of the equation, it will have a big impact on tax agents,” said Mr Chapman.
‘It is a real challenge [for accountants], particularly for those who deal with wages and salary-type taxpayers with fairly basic tax affairs - typically small suburban practices and bigger outfits like H&R Block.
“A lot of people with simple tax affairs who are dealt with by tax agents - and there are about three million of them, the tax office has estimated - will probably basically wave goodbye to their tax agents and just start doing this themselves,” he said.
According to Mr Chapman, while the scheme is initially being pitched at self-preparers, it will inevitably evolve to incorporate more taxpayers as the ATO develops more and more capability to bring in different types of third-party data.
Mr Chapman has warned accountants to take this threat seriously and to act now to secure their future income.
“If you are in the position where you have a lot of clients who fit this profile, you need to be looking at your business and putting in place some steps to change so you are not as dependent on providing these basic tax compliance services.
“[Otherwise], two or three years down the line you might find that a large part of your fee income has disappeared if you don’t make steps to change your business model," he said.