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The signs are pointing to increased activity from the ATO, a year after they effectively halted its debt and lodgement programs and hit pause of its audit and compliance-related activities.

In a speech to the to the Chartered Accountants Australia and New Zealand, Deborah Jenkins, ATO deputy commissioner for small business, spoke about how the ATO has approached the coronavirus pandemic, including moving “several thousand” employees to work on processing stimulus payments instead of regular compliance work.

However, Jenkins said it is now time for the ATO to “shift the dial back to more traditional activities”, while continuing to offer individualised support to businesses that need it.

As the tax office now begins implementing key measures included in the federal budget, such as the expanded asset write-off scheme and loss carry-back provisions, Jenkins said the ATO will be “continuing to balance our role in supporting taxpayers through this very challenging time with recommencing our work to address key risks to the tax and super system”.

“We want to keep building confidence by supporting small businesses when they need it, but we need to start shifting the focus back to ensuring good compliance for the health of the system,” she said.

 

Audits to recommence

Expect to see additional resources given to the ATO to allow it to refocus its efforts upon collecting existing (especially historic) tax liabilities.

“Perhaps, large multinational businesses will continue to be a focus, given the potentially large recoveries involved, though history suggests that the ATO’s prime target will continue to be small businesses and high-wealth individuals which account for almost half of its $53 billion debt figure.”

Based upon our years of experience in addressing tax debt action (on both sides of the tax fence), the weapon of choice for the modern ATO debt officer is the director penalty notice.

The potential ambit for a director’s personal liability continues to be extended by legislative changes with corporate PAYG, super and even now GST liabilities on the director debt action menu.

Add BAS returns filed more than three months out of time and the capacity through DPN enforcements to bring a director’s personal assets to the corporate debt discussion is now very wide.”

Audit and recovery action for COVID-19 stimulus measures, including JobKeeper and the cash flow boost, are set to continue over the next 12 months.

Initial signs is that the ATO is initially quite focused on incorrectly claimed JobKeeper payments, that does perhaps makes sense given the amount paid by the Government and fact that even the general public has recognised that, in some cases, the payments were not merited.