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  • Tax Time update – 21 July 2020

    Service Delivery

    Call volumes received by the ATO continue to be high, however have decreased since last week, which is a similar trend seen at the same time last year.

    The nature of calls remains consistent with past weeks and key topics include:

    • linking codes for myGov
    • income tax return related questions such as assistance with returns not necessary, progress of returns and account explanations
    • stimulus measure enquiries such as support for calculating turnover for JobKeeper, eligibility and progress of payment and early release of Super enquiries regarding progress of application and eligibility.

    The tax agent phone line is continuing to operate on Saturdays and Sundays from 10:00am – 4:00pm (local times) throughout July.

    The ATO is seeing a lodgment trend similar to last week with increased numbers compared to the same time last year.

    Individuals and Intermediaries

    The ATO will provide information and links to support material in an upcoming Tax Professionals newsletter to assist those located in COVID-19 lockdown areas.

    A current focus is on providing information to taxpayers to assist them with their income tax return lodgments. This includes clarifying information on work related expenses and the 80 cent per hour shortcut method and informing taxpayers how income such as JobSeeker, JobKeeper and other forms of income that they may have not previously received is reported in their tax return.

    Systems and maintenance

    ATO systems have been stable over the last week with no major issues.

    The ATO is addressing the issues with the ATO Legal Database and are planning to pilot a fix this week to resolve the issues. If successful, the fix will be deployed to production in coming weeks.

    Tax practitioners should review the ATO’s system maintenance page for details of scheduled maintenance and links to troubleshooting advice, technical help and the Performance Dashboards.

    Subscribe to Tax professionals alerts to receive email or SMS notification for unplanned Online services for agents or PLS maintenance windows and functionality issues.

    Digital Services

    Pre-fill data

    Interest and dividend data continue to be loaded into prefill as received.

    The 2020 Pre-fill availability webpage on ato.gov.au for tax time is live and will be updated daily as data becomes available.

    Digital service provider (DSP) update

    Overall DSP readiness is high with only a small number or DSPs outstanding.

    Online Services for Agents (OSfA)

    There were no significant new issues or unscheduled outages.

    Practitioner Lodgment Service (PLS)

    There were no significant new issues or unscheduled outages.

    Communications

    Tax Time 2020 video series

    This week’s videoExternal Link featuring Assistant Commissioner Sylvia Gallagher focuses on progress of return and Online Services for Agents. Sylvia also speaks about the new granular data reporting and communications functionality and their benefits.

    Supporting articles include:

    • Progress of return – article about how agents can access progress of return functions online and the benefits
    • Communications preferencing and granular data – links to existing web content to promote these features

    Articles in development

    Tax crime/scams

    • Prevent data breaches – this article is to provide information to the community about security and safety measures they can take at tax time to prevent being the victim of cyber crimes
    • Tax crime prosecution case studies

    Other topics

    • JobKeeper update - child care
    • Transfer pricing arrangements and JobKeeper payments
    • Tax treatment of Services Australia income compliance program refunds

    Individual communication

    • The ATO announced the working from home shortcut extension – now until 30 September. The ATO and the minister issued a Media ReleaseExternal Link regarding this extension. Notifications for this were included in the Tax Professionals Newsroom and promoted through social media channels.
    • Guidance has been published on how the new shortcut method applies with future calculations of depreciating assets
    • The Working from Home advertising campaign that commenced on 22 June will finish this week.

    Small business communication

    • Updates are being made to Business Losses web content, to make it clearer for the audience in preparation for promotion next month.
    • Responses to questions received following Andrew Watson’s myBusiness webinar last week will be published in two upcoming articles.

    JobKeeper update

    Requests for the Commissioner to apply discretion in relation to the alternate turnover test are being handled within the 14 days service standard. A small number of cases were stopped for compliance checking, and all of those cases should have received contact from the ATO.

    Common errors made by Eligible Business Participants include:

    • Both partners in a partnership claiming JobKeeper one as the eligible business participant and employee.
    • Company directors registering themselves as Eligible Business Participants for every company they are a director for.
    • Eligible business participant is listed as an employee with another entity.

    The ATO will consider pending Government announcements on JobKeeper changes and will work with members to implement communicate any required changes.

    Cash flow boost stimulus measure

    The ATO has recently published some updates to our cash flow boost related web contents. In particular the content has been updated to include further detail and information on the tax consequences and treatment of cash flow boost credits. We have also provided some further examples of how cash flow boost credits appear in the activity statement account summary.

    The updated web content includes a link to a cash flow boost estimator tool. This estimator allows users to input their reported W1 and W2 label amounts across one or multiple tax periods to obtain an estimate or the cash flow boost credit they may receive in a particular tax period. It should be noted that this is an estimate only and other factors can affect the final credit paid.

    This week we will be starting to issue correspondence for a small group of cash flow boost recipients as part of our compliance activities. The letters are being issued for cash flow boost recipients where we have seen an unusual or unexpected change in the amount of salary and wages and/or withholding amounts they have reported in recent activity statements. We are asking these clients to check the amounts reported. We are concerned a mistake could have been made and they may have received an incorrect cash flow boost amount. If this is the case, we will not impose penalties and will remit interest if the client revises their activity statement to correct it.

    Tips and links

    • The government has announced proposed changes to the JobKeeper Payment program, these proposed changes will not impact JobKeeper Payments until after 28 September 2020.
    • Temporary cash flow boosts will support small and medium businesses and not-for-profit organisations during the economic downturn associated with COVID-19. Eligible businesses and not-for-profit (NFP) organisations who employ staff will receive between $20,000 to $100,000 in cash flow boost amounts by lodging their activity statements up to the month or quarter of September 2020.

    Next meeting date

    The next Tax Practitioner Stewardship Group Tax time 2020 meeting will be held on Tuesday 28 July.

    Last modified: 30 Jul 2020QC 63299