The ATO is currently planning to undertake a “massive” project that will move all activity statement and franking deficit tax financial information into the one ATO system.
ATO braces for ‘massive’ tax account migration
The Activity Statement Financial Processing (ASFP) project will see more than 17 million activity statement and franking deficit tax accounts move into the accounting system currently used for income tax.
According to the ATO, the system change will deliver a single accounting system with multiple accounts, with excise accounts to move across later on.
The change is expected to take place during the ATO’s annual closure period between 24 December 2019 and 1 January 2020.
Speaking to Accountants Daily, the Institute of Public Accountants general manager of technical policy Tony Greco said the system change would be a positive move for all users, barring any system glitches during the change.
“This is going to be big, it’s huge. Basically, we’ve got a legacy system where part of it is on one system and part of it is on a more modern system,” Mr Greco said.
“It’s a massive exercise and the benefits are going to be immediate for all users but more so for the ATO itself because it will be able to manage its responsibilities better and have more visibility around account information.”
Likewise, CPA Australia general manager of external affairs Paul Drum believes it is time for the systems to come together.
“One of these systems is around three decades old. Sometimes those systems don’t ‘talk’ to each other — so a credit in, say, GST won’t automatically be applied to a debit in another tax. Having a single system will address these types of problems,” Mr Drum said.
According to the ATO, the system change will bring new functions to online services for agents, including simplified transaction descriptions that use abbreviations for common tax types and a summarised view of statement of account transactions, with the ability to expand and view the full account transaction list if required.
Tax agents will also be able to see pay-as-you-go (PAYG) withholding director penalty accounts against individual director tax file numbers.
There will also be updated payment plans that will include direct debit options, and the incorporation of concessional due dates in activity statement due dates, meaning tax agents and their clients will no longer need to add four weeks to the date on the activity statement to determine the actual lodgement date.
While the ATO is planning to implement the change during the December year-end closure, the professional bodies have warned that potential hiccups might appear in the new year.
“Obviously, these changes come with risk. We’re told that they can do it and they’ll be working feverishly to make sure that it migrates to the new system seamlessly,” Mr Greco said.
“That’s obviously the intention, but there’s a lot going on and it is certainly not an insignificant body of work.”
Mr Drum also said that practitioners should consider the ATO’s intention to halt updates to the old tax agent portal, warning that the data might be incorrect from 2020 onwards.
“We would be surprised if there are not a few teething issues in early 2020,” Mr Drum said.
“Also, while no date has been provided to us regarding the closure of the old portal, if it continues to remain live beyond the software change, we have been warned that its numbers will likely be incorrect.”
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