The federal budget revealed that the ATO is set to receive millions in further funding for its Black Economy Taskforce, meaning accountants need to up their focus with clients who operate cash-based businesses to ensure compliance.
ATO’s budget boost calls for accountants’ vigilance
Yesterday the government released the Black Economy Taskforce’s interim report, accepting its recommendations and including them in the budget 2017.
Changes include continuation of funding for ATO audit and compliance activities that target the black economy; the extension of the Taxable Payment Reporting System to the courier and cleaning sectors to ensure payments made to contractors are reported to the ATO; and a ban on the manufacture, distribution, possession, use or sale of sales suppression technology.
The budget 2017 includes $360.1 million in funding for ATO Black Economy Taskforce audit and compliance activities in 2017-18. A further $87.1 million has been allocated for the three years following.
BDO national tax director Lance Cunningham told Accountants Daily that this will have a flow on effect on accountants and tax agents.
“The Black Economy Taskforce’s report recommended an increase in the Tax Office’s funding for that, so that certainly will be something that may have an effect on tax agents and accountants that have clients in the cash economy,” Mr Cunningham said.
“That they will have to be looking, scrutinising what they’re doing to make sure that they’re not going to be in the firing line from the tax office in relation to that.”
Mr Cunningham said that this is nothing new for accountants, but that the risk of being non-compliant clients being caught is heightened.
“That’s something that accountants and tax agents should already be doing. It just means that there’s more firepower from the Tax Office, so it’s going to be more of an impetus, particularly for anyone that does have a cash-based business,” he said.