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ATO linking system takes giant stride into business

Tax

The revised procedure will encompass an additional 1.7 million entities from 13 November.

By Philip King 11 minute read

The ATO’s revised client linking system takes a giant step forward in November to take in roughly 1.7 million businesses yet to be encompassed by the rollout.

The expansion, which starts on November 13, applies to all businesses with an ABN except for sole traders and includes companies, trusts, partnerships, not-for-profits and superannuation funds.

The six-step procedure, as outlined by the ATO late last year, prompted a storm of protest on social media and angry comments from Accountants Daily readers who described it as a “joke” and “absolutely ridiculous”.

Representatives from CA ANZ, CPA Australia and IPA are understood to have pushed for changes to the system but it survived unmodified, the ATO said.

“The process will follow the steps used by the 191,000 business entities who have been progressively deployed since 19 June 2022,” an ATO spokesperson said, referring to the initial phases of the rollout which took in big business, multinationals and government entities. 

Outlining the new procedure the ATO said: “Businesses and organisations included in the process will need to nominate their agent before the agent can add them to their client list.”

“They will need to use the new agent nomination feature in Online Services for Business when they:

  • Engage a new tax or BAS agent, or payroll service provider to represent them
  • Provide extra authorisation to their existing authorised agent (for example, the agent begins representing them for a new obligation, such as income tax or a new entity in their group).”

“After your client completes the agent nomination, you’ll have seven calendar days to add them to your client list in Online Services for Agents or your practice software. You won't get an automated notification advising you that your client has completed the nomination. So, make sure you tell your client to let you know.”

Head of policy and advocacy at CPA Australia Elinor Kasapidis acknowledged the ATO’s need to tighten security but said many businesses would struggle with the system.

“Our members are understandably concerned about the extra work it creates for their clients,” she said. “This is especially so for small businesses who have previously relied on their tax agent to do this work for them.”

“Switching to digital systems should make things easier and more efficient, but only if businesses know how to use them. The ATO needs to ensure it provides adequate support to businesses when they begin to navigate this change.”

“We have a diverse society with lots of different needs and accessibility is important. It’s crucial to make sure there are alternatives such as paper and phone-based options for those who require extra support.”

The ATO confirmed it would proceed with the final phases of the rollout, which will take in roughly 800,000 sole traders and more than 15 million individuals.

“We intend to roll out the client-to-agent linking to individuals and sole traders in the future,” an ATO spokesperson said. “We will be consulting with the community before we deploy this tailored solution to them.”

“We have listened to feedback from those entities that have been deployed and we are continuing to enhance the process and provide additional support material.”

Director of 5ways Group accountants Paul Meissner, who was a party to the ATO consultation process on the system, said it was unclear whether the procedure would survive unchanged for the next phase but welcomed the latest expansion despite a few issues.

“As a tax agent, as a small business owner, I don't see what the fuss is about,” he said. “MyGovID is currently being used for tax agents – it’s being expanded.

“The new Online Services for Agents is the accepted platform for agents. Online Services for Business, which is the business version of the portal, is already the accepted contact point for the ATO.”

“The professional bodies are very good at theory and policy. But they don’t have the practical knowledge because they don’t press the buttons every day.”

“Let’s talk about how we can streamline this experience, which the ATO is extremely focused on doing.”

 

 

 

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Philip King

Philip King

AUTHOR

Philip King is editor of Accountants Daily and SMSF Adviser, the leading sources of news, insight, and educational content for professionals in the accounting and SMSF sectors.

Philip joined the titles in March 2022 and brings extensive experience from a variety of roles at The Australian national broadsheet daily, most recently as motoring editor. His background also takes in spells on diverse consumer and trade magazines.

You can email Philip on: This email address is being protected from spambots. You need JavaScript enabled to view it.

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