Thinking Tax is an initiative from Crowe to provide you with a short overview of specific tax issues that may affect you or your business, with a focus on practical issues you may face on a day to day basis.
The COVID-19 pandemic has caused financial hardship and uncertainty for both tenants and landlords.
Regardless of all these changes, it is important to note:
The ATO has expanded its Tax Avoidance Taskforce to help ensure private groups and high wealth individuals pay the right amount of tax. COVID-19 caused some compliance and audit activities to be deferred but over the next few months, the ATO is due to start engaging with taxpayers again.
Taxpayers that fall into either the Top 500 program (Australia’s 500 largest private groups) or Next 5,000 program (the next largest 5,000 private groups controlled by high wealth individuals who control wealth of more than $50 million) can expect specifically tailored contact from the ATO, such as a one-to-one engagement strategy. This compliance activity is expected to follow the Top 1000 engagement approach (which applied to public and multinational companies).
When performing reviews, the ATO will seek to apply their 'justified trust' methodology to obtain assurance the group has paid the right amount of tax. To date, the ATO has been generally pleased with the progress of the Justified Trust Program and reiterates that communication is key to their approach to taxpayers. Cases that have gone well are those where there have been open and transparent communications.
Specific risk factors that may attract the ATO’s attention include:
If you have attracted the attention of the ATO during their review, you can expect individual contact from them in the form of a notification letter. You should be able to provide information to the ATO about:
Crowe can help you manage the ATO early engagement process by examining your tax position to identify and address potential tax risks and help reduce penalties through early detection and voluntary disclosure of errors.
Roelof van der Merwe, National Tax Director (Melbourne)
Peter Fallon, Senior Partner, Tax Advisory (Perth)
Anthony Patrk, Partner, Tax Advisory (Sydney)