The JobKeeper Payment Scheme has been a lifeline for many businesses since April 2020 when the COVID-19 pandemic started impacting businesses. The program is set to end on 28 March 2021, and business owners are considering their options.
In addition to meeting expenses, businesses also need to prepare for the ATO resuming its audit and compliance activities. Since the beginning of the pandemic the ATO has taken a lenient approach to payments and compliance obligations. These included:
- Varying PAYG installments
- Payment plans for super and tax debt
- Remitting interest and penalties
- Changing GST reporting cycle to receive refunds sooner
- Deferring GST payments for importers.
As collectable tax debt to the ATO now sits at $34 billion, with $21 billion of this owed by small businesses, many experts are assuming that stronger enforcement will resume once JobKeeper ends at the end of March.
The Institute of Public Accountants has advised accountants to get ready for business-as-usual from the ATO. Some accountants have reported an increase in correspondence from the tax office concerning payment arrangement and defaults, and see this as a sign of more to come.
As JobKeeper comes to an end and the ATO resumes regular activities, accountants are recommending that business owners get their books in order and take stock of their financial positions. If ATO payment plans are in place, showing a commitment to pay, and keeping the lines of communication open if you are struggling, will make it easier to resolve any issues.
If your business is facing a tax debt which would impact your cash flow, refinancing that debt into manageable repayments can also be helpful. An unsecured business loan from Moula can help with refinancing ATO debt, or help with cash flow.