The ATO is now taking a tough line on businesses that fail to pay their tax and superannuation debts. The Tax Commissioner recently stated that small businesses ‘continue to be over-represented’ in the debt book. An estimated $50.2 billion has accumulated in collectable debt owed to the ATO. Unfortunately, SMEs account for more than $33 billion of that figure, with approximately $23 billion being unpaid business activity statement debt.
Understandably, collecting that debt is now a big focus of the ATO. To address the issues, earlier this year the government announced a unique amnesty for small businesses who may be behind in their tax obligations. This is a relatively rare occurrence from the ATO.
As part of this program, the government will work with business owners whose tax obligations in business activity statements, tax returns and/or fringe benefits tax were due between 1 Dec 2019 and 28 February 2022. The amnesty only applies to those businesses with an annual income of less than $10 million at the time their tax lodgements were due.
This means businesses can rectify any overdue activity up to 31 December this year without an expensive ‘failure to lodge penalty’. We encourage businesses who may be eligible for this amnesty to contact dmca so we can engage on their behalf with the ATO and bring operations up to suitable compliance levels.