Draft statement of the ATO approach to electronic service delivery

Second Commissioner Geoff Leeper, Australian Taxation Office

The following outlines our strategic approach to service delivery for taxpayers, from 2014 forwards over three to five years, and is provided to assist the market to position their own strategies and business approaches.

We are committed to providing contemporary services that make complying with taxation and superannuation obligations as easy and as cheap as possible. We want to work collaboratively with technology partners, software developers and tax practitioners to achieve this outcome. We are committed to using whole of government approaches such as myGov for individuals, and Standard Business Reporting (SBR) for business transactions, but we are also open to advice on the role emerging technologies can play. This statement outlines our key approaches and areas where we believe that further consultation with relevant industry players will quickly point to beneficial outcomes.

The ATO notes that while SBR has been available to the market since 2010 and take up is increasing, recent developments such as the rise of mobile computing and the ongoing need to support large-scale data exchanges may also require consideration of a wider range of transmission methods and messaging formats. We remain committed to implementing SBR as a replacement for the current Electronic Lodgement Service, stressing in that process the value-adding opportunities available for tax practitioners of a common computer language.

For individuals, we are committed to offering a superior online experience for individuals preparing their tax returns. We deliver services via the myGov service portal, offering secure two-way communication of information across a range of devices with secure login facilities. The ATO joined myGov in May 2014.

For individuals with simple tax affairs, that is wage and salary earners with bank interest and dividends and with relatively straightforward deductions, we use the third party data already available to us to substantially pre-prepare a streamlined tax return through the myTax product

  • Individuals with simpler tax affairs can complete their tax return via myGov should they wish to lodge immediately after the tax period opens on 1 July, or if they wait until the ATO has received prefill data (around mid-August), individuals receive a notification from the ATO that a pre-prepared tax return, is accessible through myGov
  • We will extend the functionality of this offering further in 2015 and 2016, with the objective of offering a very simplified tax return experience for around 4.5 million individual income taxpayers
  • Our preferred longer term outcome, subject to government policy decisions, is that we offer ‘no touch’ returns for taxpayers with simple affairs, where they could accept the ATO assessed amount without the need to enter any data, noting that under current self-assessment arrangements, a taxpayer must still declare that the prefilled return is accurate and complete.

For individuals with more complex tax affairs, we will offer tax return services through myGov. In the short-term, this will be through e-tax, but this will be replaced by a secure web-based tax experience tailored to the individual. We intend to transition to fully web-based services by 2016 and decommission the current downloadable e-tax offering from July 2016.  

  • We will continue to use the third party data available to us to prefill tax returns.

For businesses and tax practitioners, our aim is to make services available via their business and practice management software, based on a common computer language standard (SBR), so meeting tax reporting and payment obligations is closely aligned to or becomes a by-product of their primary business system.

For businesses, we will deliver taxpayer services in the following ways:

  • We will co-design with software developers and accounting industry representatives to prepare a standard chart of accounts that will cater for the majority of small and medium size businesses to assist them in meeting tax and reporting obligations. Through software vendors, the standard chart of accounts will automatically generate the information required for tax reporting purposes and be transmitted to the ATO at the appropriate times using SBR and eXtensible Business Reporting Language (XBRL)
  • We intend to provide support through online services such as our Small Business Assist banner, to help a small business more easily meet its tax payment and reporting obligations. Our preferred standard for the transmission of small business tax returns will be SBR/XBRL
  • For larger businesses, we will work with software providers to ensure that software packages use SBR/XBRL to streamline the effort required to prepare and submit tax and reporting information to the ATO and other government agencies
  • For transactions involving high volumes of data (either high volumes of one to one data exchange or bulk data uploads), the ATO will support the provision of that data via a limited range of formats including eXtensible Mark-up Language (XML), XBRL and Bulk Data Exchange (BDE) formats
  • In the superannuation sector, we will use SBR/XBRL/Electronic Business eXtensible Markup Language Messaging Services (ebMS) to support open two-way communication between super funds and the ATO, between funds themselves, and also between employers and funds. This implementation is underway for fund to fund rollovers.

For tax practitioners, we are committed to providing a better service integrated with business software. We recognise the fundamental importance of the Tax Agent Portal to tax practitioners’ business and seek to improve upon the current service by taking advantage of new and emerging technology.

  • We are in the process of enabling, from July 2015, the transmission of tax return data via standard business reporting (a common computer language)
  • We will consult and co-design with the tax practitioner community about the future of the highly valued Tax Agent portal to ensure that our business directions reflect the business needs of this group. One option we will explore in ensuring practitioners have a better interaction in relation to their clients’ tax affairs, is whether, in a world of a common computer language, the current functionality of the Tax Agent Portal could be more effectively provided through direct software packages from the developer market.

We will always provide software for those taxpayers wishing to prepare their returns, but for software developers, the ATO will:

  • make available to the broader software market the streamlined income tax lodgement services to develop an income tax lodgement offering directly from individuals
  • develop all services so they are able to be made available as retail (directly from the ATO) or wholesale (for software developers to consume and make available)
  • support the outcome of simplified services for business taxpayers allowing both ATO-sponsored and third party software services.

For all feedback and any queries contact silu@ato.gov.au

    Last modified: 26 Sep 2014QC 39332