Show download pdf controls
  • Individuals Stewardship Group special briefing 21 May 2020

    COVID-19

    Overview of Government stimulus and ATO support

    The ATO is responsible for several of the Government’s COVID-19 economic support measures, including:

    • individuals early access to superannuation
    • cash flow assistance for employers (cash flow boost)
    • wage subsidies through JobKeeper
    • increasing the instant asset write-off (making more businesses eligible)
    • backing business investment by accelerating depreciation deductions.

    Priority has been to deliver these commitments as quickly and effectively as possible. We are experiencing a 150% increase of calls to our call centres on what we had at the same time last year, and this is higher than the volumes we see in Tax Time. To enable the community to obtain assistance and advice and to meet this demand, the ATO has extended its opening hours to 8.00am to 8.00pm Monday to Friday and 10.00am to 4.00pm on Saturdays and Sundays.

    A ‘one stop shop’ for COVID-19 information is available on the ATO website which includes:

    • frequently asked questions
    • 'top 5 call centre calls’ - provides a real time reflection of the most popular questions over the past day.

    We have a dedicated Emergency Support Infoline on 1800 806 218 for help tailored to individual circumstances and a dedicated contact number for registered tax agents 1800 700 724.

    Besides the stimulus measures, additional COVID-19 support includes:

    • working from home guidance which provides a shortcut’ method (80 cents per hour) for calculating deductions for 1 March–30 June
    • information about tax on employment payments (i.e. on leave, stood down or lost your job because of COVID-19)
    • payment and lodgment deferral options, including low interest payment plans to help pay existing or ongoing tax liabilities
    • allowing people to vary pay as you go instalment amounts to zero and claim a refund of instalments already paid for the March 20 quarter.

    The ATO’s continued message to people affected by the bushfires is that we understand their priority is for their families and community and we will help them sort their tax affairs when they are ready to do so. People who need more time are encouraged to phone us on 1800 806 218 or speak with their registered tax professional.

    If you or your members are concerned about a potential scam, or have paid or provided personal information to a scammer, phone us on 1800 008 540, or you can report the scam online. Suspicious emails claiming to be from the ATO can be forwarded to ReportEmailFraud@ato.gov.au and then deleted.

    Members’ comments

    • There are more individuals and small businesses seeking financial counselling services that wouldn’t normally get Government support and are unfamiliar with the processes and their entitlements for the stimulus measures.
    • Some people are unsure as to whether their circumstances fit 'hardship' for early release of superannuation purposes, particularly demonstrating the loss in income, even if still employed or are receiving government pension/benefits or where some personal circumstances are not typical, i.e. no income while awaiting a divorce settlement and needing to make mortgage repayments.
    • Concerns that individuals are seeking to access their superannuation but have not considered that they may have other options like payment arrangements with financial institutions or accessing other government support. Taking out their superannuation may not be the best option for them in the longer term.
    • Questions about what happens where an individual receives an early release of superannuation but no longer needs it and wants to return it to their account:
      • Will there be double taxation?
      • How is the contributions cap affected?
       
    • The ATO noted they will be publishing some web advice on various scenarios involving re-contribution of superannuation soon.
    • University tax clinics were receiving questions on JobKeeper mostly from sole traders who started operating in the last 6 months and do not have prior year turnover to compare to. It was noted that ATO advice has been provided on this.
    • Scams are a concern, particularly those more vulnerable.
    • Newly arrived migrants are mostly primary concerned with JobSeeker. They are susceptible to scams and the ATO focus on Scam prevention is welcomed.
    • Some self-funded retirees who have taken losses due to COVID-19 would like to top-up their superannuation but cannot as they over 75. There were a range of scenarios where this limitation on the ability to contribute to super was explained. This is a policy question noted by Treasury.
    • The proposed Government boost to the building industry is positive. But due to them having their own marketing and sales areas, there would be no flow-on to the real estate sector. Employment and income is likely to be down well after 30 September 2020 when most Government stimulus ends. What are the prospects of extension of the stimulus package? This is a policy question noted by Treasury.
    • ATO information on COVID-19, particularly JobKeeper, has been timely and 'great' and has been shared more broadly by members; also, they really appreciated the advice in other languages. Members appreciated the ATO support for the community at this time.

    Update on Tax Time 2020

    Research in preparation for Tax Time 2020

    The ATO has done some research with the community about their perceptions in how they will approach Tax Time in 2020. Below are some of the indicative findings from this research:

    • This year, some taxpayers are counting on refunds for basics like food and accommodation, rather than holidays or other discretionary spending. This likely to drive earlier lodgment.
    • In 2019, the ATO advised taxpayers to wait to lodge to allow prefill data to be put into their returns which will assist them to avoid errors. For 2020, given the current environment, the message will change slightly. For self-preparers, the ATO will be sending an SMS to taxpayers to let them know that they will receive a myGov message when their pre-fill is ready. This message tested well with participants.
    • Taxpayers are most likely to have questions about the new types of income they are receiving such as JobKeeper and JobSeeker and how these should be accounted for in their tax returns. Tax Time 2020 communications will focus on these frequently asked questions.

    Members’ comments

    • The University Tax Clinics will be providing a Tax Help service and are supporting taxpayers who do not have or cannot use technology.
    • Self-funded retirees that are dependent on company shares for income are impacted by smaller dividends and fewer franking credits. They will be looking to lodge as early as possible and hope that company data will be available for pre-fill before 31 October 2020. The ATO confirmed that they have been in touch with all data providers and they are on track to make data available at the same time as it was last year.

    Agency updates

    Services Australia

    Services Australia is committed to delivering its services while focussing on making JobSeeker payments available to those that need it. They are prepared for any changes in the environment (pandemic) that may require them to react quickly.

    Treasury

    The Treasury continues to work with all Government Agencies to support Government stimulus for COVID-19. A dedicated team has been set up to consider recovery.

    The Department of Prime Minister and Cabinet has established a COVID-19 response centre too.

    The Senate Enquiry into the management of the COVID-19 is ongoing.

    There is a revised Parliamentary sitting calendar with two additional weeks in June 2020.

    Submissions to the Standing Committee on Tax and Revenue’s inquiry into Employee Share Schemes closes on 30 May. Hearings will begin in early June 2020.

    Australian Securities and Investments Commission (ASIC)

    ASIC is focussed on providing financial support advice to the community affected by COVID-19. The MoneysmartExternal Link webpage has been updated accordingly and includes links to relevant partner websites and information about scams.

    The Moneysmart website includes a tool to help people consider the impact of early access of superannuation. It has had a substantial increase in views, with over one million in April 2020.

      Last modified: 03 Jun 2020QC 62787