What other measures are available to small businesses?

Easier for businesses to use their losses

A new similar business test has been introduced, making it easier for a loss business to transfer its losses to a profit business where the businesses are similar.

The similar business test now means same assets, same activities, same identity with differences only coming from natural growth.

New GST withholding obligations on the purchase of new residential premises

From 1 July 2018, purchasers of new residential premises must pay vendors a GST exclusive amount and send the GST direct to the ATO.

No tax deductibility of employer payments to employees if PAYG obligations not met

From 1 July 2019, an employer will be allowed a tax deduction for payments to an employee only when the PAYG withholding obligations have been met. These are: the withholding of the tax when the employee is paid and the reporting of that amount to the ATO.

Cheaper, quicker and less intimidating resolution of ATO disputes

For small businesses, a new process has been introduced making the resolution of ATO disputes arising from minor technical matters identified in the tax return or an audit, cheaper, quicker and less intimidating.

Applications will be considered by a small business division of the Administrative Appeals Tribunal to commence from 1 July 2019 and be generally conducted without lawyers.

If for any reason, the ATO engages external lawyers, they will be obliged to pay the business’ cost of equivalent support. Decisions need to be given within 28 days of the hearing.

Tip! Your adviser will be able to advise if in your circumstance this approach is in the best interest of your business or yourself.

Read our complete June 2019 Taxwise Business Newsletter here

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