ATO consultation report

This report describes ATO consultation activities to 30 November 2019.

This report is prepared monthly and shared with our stewardship groups.

It contains:

• Consultation matters    
  • Statistics
  • Consultation matters received November 2019
  • Consultation matters completed November 2019
  • Draft advice and guidance products open for consultation in November 2019
• News    
  • Stewardship groups
  • Special purpose working groups    
  • Stakeholder relationship groups

Consultation matters

Statistics

Consultation matters received

If a consultation matter was received and completed in the reporting period, the information is provided under consultation matters completed.

[201941] Structured arrangements providing imputation benefits

[201939] ‘Term of the lease’ meaning in Taxation Determination 93/142

[201938] Individuals' tax return preparation and lodgment

[201937] Director Identification Number

[201936] Online services for business

[201935] Reimbursement agreements - scope and ordinary family and commercial dealing exceptions

Consultation matters completed

[201940] 2019 Reportable tax position schedule instructions

[201934] Proposed Draft Taxation Ruling - Income Tax: when are deductions allowed for employees’ transport expenses?

[201933] Improving Low and middle income tax offset understanding

[201922] Improving the 2020 Company Tax Return (CTR) Instructions

Draft advice and guidance products open for consultation

Decision Impact Statement

Decision Impact Statement Bluescope Steel (AIS) Pty Ltd v Australian Workers' Union

Draft Legislative instruments

CRP 2019/D1 Draft Taxation Administration (Remedial Power-Disclosure of Protected Information by Taxation Officers) Determination 2019

WAN 2019/D1 Goods and Services Tax: Waiver of Adjustment Note Requirement (Corporate Card Statements) Determination 2019

WTI 2019/D2 Goods and Services Tax: Waiver of Tax Invoice Requirement (Visa Purchasing Card) Determination 2019

Draft Practical Compliance Guideline

PCG 2019/D8 Superannuation contributions made to the Small Business Superannuation Clearing House - compliance approach to timing of income tax deductions

Draft Taxation Determinations

FTD 2019/D1 Fuel tax: fuel tax credits – vehicles and satisfying environmental criteria

TD 2019/D12 Income tax: is section 951A of the US Internal Revenue Code a provision of a law of a foreign country that corresponds to section 456 or 457 of the Income Tax Assessment Act 1936 for the purpose of subsection 832-130(5) of the Income Tax Assessment Act 1997?

Draft Taxation Rulings

TR 2019/D6 Income tax: application of paragraph 8-1(2)(a) of the Income Tax Assessment Act 1997 to labour costs related to the construction or creation of capital assets

TR 2019/D5 Fringe benefits tax: car parking benefits

TR 2019/D4 Income tax: employees: deductions for work expenses under section 8-1 of the Income Tax Assessment Act 1997

See Open consultation for current products open for consultation.

News

Stewardship groups

The Consultation Steering Group met and the topics discussed included:

• overview of the role of the ATO Consultation Hub
• specific nominated consultation matters and the implications on consultation
• proposed consultations from Treasury, Board of Taxation and the ATO
• insights from the consultation approach undertaken for child care reform in the Department of Education
• achievements of the CSG in 2019 which included positive feedback on the refreshed role and scope of the CSG.

The GST Stewardship Group met and the topics discussed included:

• e-invoicing with a focus on the history, benefits, relationship to GST and the role the ATO plays as both an accredited network user and the Australian Network Administrator. The Group is interested to know more about e-invoicing and what opportunities might arise for the system.
• GST low value imported goods compliance program, work being done to engage the unregistered population and associated GST revenue risks
• University of NSW paper on the VAT/GST compliance burden and the factors that lead to perceived different tax burdens on taxpayers across the 47 countries that use these taxes..
• risks, macro-performance measures, the four compliance pillars approach and some findings about perceptions of the effectiveness of the GST voluntary compliance program.

The Individuals Stewardship Group met and the topics discussed included:

• Tax Time 2019 wrap-up, where 11.4 million tax returns were lodged - 4.2 million through myTax and over 7 million through a tax agent
• Better As Usual program aimed at making continuous, systemic and sustained improvements to the ATO’s end to end processes and using the insights into the system to make the client and staff experiences better
• our data acquisition program and future plans and how we make that data available through pre-fill
• how we support the community to stay informed about impersonation scams and what to do if they have been affected
• work we are doing with stakeholders to identify areas for improvement that help executors and tax agents finalise estate matters
• an overview of the work we are doing to proactively reunite inactive low balance accounts and unclaimed ATO held super to an eligible active super account.

The Large Business Stewardship Group met and the topics discussed included:

• ATO compliance activities and emerging risks
• Digital Identity Program
• Board of Taxation program of work
• status of Legislative Measures
• ATO’s Justified Trust work
• Corporate Tax Association Benchmarking Survey.

The National Tax Liaison Group (NTLG) met and the topics discussed included:

• Self-assessment, lodgment and review, data collection and analysis which covered the ATO’s data acquisition program, future plans and how the ATO makes that data available through pre-fill
• Better As Usual program which aims to provide continuous, systemic and sustained improvements to the ATO's end to end processes and using the insights into the system to make the client and staff experiences better
• Vacant land measure and how the ATO might administer this legislation
• Discussion on key ATO changes for agents including the transition to the new Online Services for Agents platform with the closure of the Tax and BAS portals for tax professionals; the Activity Statement Financial Processing upgrade; and the implementation of myGovID to replace AUSkey.

The Commissioner expressed his appreciation to Second Commissioner Andrew Mills for his outstanding contribution to the ATO and to the ATO’s consultation processes and activities as Co-chair of the NTLG and Chair of the Consultation Steering Group. NTLG members thanked Andrew Mills for his chairmanship of the NTLG and for his contribution to taking the administration of tax law forward

The Not-for-profit Stewardship Group met and discussed issues and challenges experienced by self-assessing income tax exempt not-for-profits and their representatives. Insights are being considered with a view to identifying opportunities that facilitate confidence that not-for-profits are supported and meeting all of their tax and superannuation obligations.

A number of members met to finalise input into draft Taxation Ruling TR 2018/D1 Income tax: the 'in Australia' requirement for certain deductible gift recipients and income tax exempt entities which is expected to be published in December.

The Private Groups Stewardship Group met and the topics discussed included:

• issues in the property and construction industry and their relevance to the Private Wealth market
• proposed methods used by the ATO to communicate case findings, insights and outcomes for the Top 500 and High Wealth Private Groups Tax Performance Programs of work
• AUSkey transition to myGovID and Relationship and Authorisations Manager (RAM) services
• development of preliminary ATO Guidance on Section 100A - reimbursement agreements
• future release of the High Wealth Private Groups Tax Gap and the planned supporting communication activities.

The Small Business Stewardship Group met and the topics discussed included:

• impacts of the drought and recent bushfires on small businesses in affected communities and the ATO’s response
• AUSkey transition and the ATO’s planned support and tools to help small business transition to myGovID
• potential barriers and incentives to taking up e-invoicing by small business
• Disclosure of Business Tax Debt measure, including the possible impact on small businesses
• small business experiences in transitioning to Single Touch Payroll (STP)
• draft factsheet for small business on transitioning to myGovID. Members’ feedback on the messaging and language used is being incorporated into revisions.

The Tax Practitioner Stewardship Group met and the topics discussed included:

• review of Tax Time 2019 and implementation
• tax performance for the individuals client experience including updated tax gap figures and the impacts ATO strategies are having on work related expense claims
• feedback from agent consultation and resulting changes to the Intermediaries Assurance Strategy
• Australian Business Number reform
• Activity Statement Financial Processing project
• key changes to the agent experience resulting from significant changes impacting tax professionals from now until April 2020
• superannuation.

Special purpose working groups

The Activity Statement Financial Processing (ASFP) Working Group continued to meet fortnightly to discuss elements of the project that will impact the client and tax practitioner experience.

The main topic discussed was the ATO’s readiness for the change. A suite of testing is being conducted to provide assurance that the changes being implemented provide the right outcomes for the ATO and the broader community. Discussion included a review of a high level view document showing the external client experience changes resulting from ASFP which will supplement communication and readiness products.

The Large APRA fund extract co-design group met and members:

• agreed on the final design principles to initiate development of the Large APRA fund extract prototype and the key metrics/statistics of most value to understand a fund’s performance and conformance with reporting obligations
• highlighted the need to communicate a definite separation from the Risk Differentiation Framework (RDF), and create a new brand with a clear message about the scope and objectives of the Large APRA fund extract
• advised they want the extract to be multipurpose, taking advantage of the data the ATO holds, to assist industry to track their own performance in specific areas and identify hotspots
• agreed on quarterly reports for the initial prototype to provide trend analysis, and include year-to-date figures for a holistic view at both the Fund and Industry level
• were advised that the initial prototype will be developed and tested within the Large APRA fund extract co-design working group in the first quarter of 2020.

The SMSF Rollovers and Release Authorities v3 Co-design Group met and members were:

• were advised of the progress of the project including the detailed design, system changes, legislative framework, communication pieces and developing scenarios for each possible RA encounter
• briefed on the technical artefacts and user guides, with feedback requested by 18 November 2019.

The Single Touch Payroll Advisory GroupExternal Link met and members:

• were given the opportunity to discuss any insights or feedback provided by their clients/members.
• were informed about the overall status of STP including the ATO’s end-to-end assurance framework
• discussed the progress on Phase 2 of STP including the current consultation with Digital Service Providers
• were briefed on the small employer transition progress including the current advertising campaign
• were informed on the use of STP data within the ATO and Department of Human Services as part of Phase 2.

The Tax Time Shareable Content Group met to review and provide feedback on the following new products for the ATO website:

• website content relating to teachers and education professionals
• myGovID/RAM fact sheet and ato.gov.au landing page
• ‘Staying on top of your super obligations’ employer fact sheet.

Members recommended the ATO draft a fact sheet to help employers understand superannuation guarantee lodgment and payment obligations, and provided detailed development suggestions

Stakeholder relationship groups

The BAS Agent Association Group met to continue discussion on the STP quarterly reporting closely held process. Members:

• were advised of available options to report closely held payees income quarterly in 2020 to ensure a closely held payee will not be flagged by the ATO as non-compliant
• were provided an update on policy decisions and class exemptions for employers with a withholder payer number (as opposed to holding an ABN), and on portable long service leave board/redundancy funds. The ATO is in the process of requesting both these class exemptions roll forward for another financial year to allow the ATO time to provide transition options to these two groups.
• will be consulted to review draft web content before content is published on the ATO website.

The Tax Profession Digital Implementation Group met and the topics discussed included:

• ATO digital services for agents including Online services for agents and the decommissioning of the tax and BAS agent portals on 29 November 2019
• private beta testing of communication preferences functionality via Online services for agents
• tax practitioner access to deceased taxpayer information following the decommissioning of the tax and BAS agent portals
• myGovID public beta and supporting agents to transition to myGovID and RAM
• implementation of granular data for tax agents
• a reflection of Tax Time from a digital perspective.

The overall sentiment from members about the significant changes impacting the tax practitioner community over coming months is that communication and support are key in the transition processes.