We’ve been in close dialogue with the ATO to find out what are the most important changes that accountants need to be aware of this year.
The following is a summary of the top 16 things you must know now:
Must know right now tax tips for all tax agents
- This year employees will be receiving both an income statement on their myGov account if their employer is using Single Touch Payroll (STP). This replaces the physical payment summaries/ group certificates. The employee’s MyGov account will show the employee when their income statement is ‘tax ready’.
- For the 2019 tax year only, employers are required to finalise employee income statements by 31 July 2019, not 14 July 2019. To reduce the risks of mistakes and consequential amendments to tax returns, it is strongly advised to wait until income statements are ‘tax ready’ before lodging.
- Most pre-filling information will be available by mid-August. This is another reason to wait to lodge returns until after that time if the information has not been made available to your clients.
- While some clients - particularly salary and wage earners - may be very keen to get their tax refunds as soon as possible, given the delays in access to some of the pre-filling data, and to avoid double handling of client files, it is prudent to delay client meetings until later in the month/ year.
- Private health insurance providers are no longer required to send end-of-year information directly to policy holders. This information should be included in pre-fill information by mid-August. It is expected however that some health insurance providers will continue to send information or alerts.
- The government is seeking to increase the low- and middle-income tax offset (LMITO) for the 2018-19 year. If the change becomes law, the ATO will automatically amend assessments with no action required by individuals or tax agents. As Parliament is sitting in the first week of July, you may wish to defer lodgment until the outcome of the Bill is known.
- Make sure you correctly enter deduction data for labels D1-D15, as line entry data will form part of the tax return for 2018-19 and beyond.
- Ensure you correctly identify your client’s occupation or business industry codes.
- Your practice management software may alert you in real time as to when a client’s deduction claim seems high compared to other taxpayers within the taxpayer’s industry or occupation.
- There will be a large increase in taxpayers establishing their myGov accounts with income statements now only available online. As a result, ATO correspondence such as Notices of Assessment will be sent to your client’s myGov account and not to the tax agent directly.
- You should regularly check and maintain your client correspondence list (CCL) on Online services for agents to ensure you receive copies of correspondence sent by the ATO to your clients. The ATO is working on a correspondence preferencing solution which is due in October 2019.
- The ATO will send weekly progress of return emails to agents to inform you of potential delays in processing a client’s return 10 days post-lodgment. This will replace the weekly 30-day Delayed Refund Report.
- Under the Tax Agent Services Act 2009, all tax agents are required to take reasonable care.
- The ATO’s Online services for agents does not include information on your deceased clients. To access this information, agents will need to use the Portal.
- Cyber fraud is always on the rise, so check your security and watch out for fraudsters.
- Check that TFN reports have been lodged by trustees where relevant.
For more complete details: https://www.cpaaustralia.com.au/professional-resources/taxation/tax-tips/information-for-agents
For checklists CPA Australia members can use in their client engagement: https://www.cpaaustralia.com.au/professional-resources/taxation/tax-tips