February Tax Updates

Updated: May 6, 2019



STP to cover all businesses as legislation passes

The extension of Single Touch Payroll (STP) to employers with 19 or fewer employees has been passed today after amendments were made last December.


This will mean that employers with 19 or fewer employees will have to report under STP rules from 1 July 2019. Businesses with 20 or more employees began reporting from 1 July 2018.


The ATO has also pledged to ease microbusinesses (one to four employees) into the STP regime, stating that they will not be forced into purchasing payroll software. A number of other options will be available such as allowing their tax agent to report quarterly, rather than each time they run their payroll.


Exemptions to STP reporting will also be available to businesses that have no internet or have an unreliable connection.


The ATO will grant a buffer period of three months for small businesses to comply with the newly legislated extension of single touch payroll regime to all businesses. The start date of 1 July 2019 for employers with 19 or fewer employees will mean businesses will be allowed to start reporting any time between 1 July and 30 September 2019. The 30 September deadline has been chosen to give employers more time to make the transition to real-time digital reporting.


There will also be no penalties for mistakes, missed or late reports for the first year.



New SMS scam ‘spoofs’ ATO number



The ATO has become aware of a new scam that sends SMS messages under the appearance of a phone that appears to be sent from the Tax Office.


It is a tactic, known as “spoofing”, it is a common technique used by scammers in an attempt to make their interactions with taxpayers appear legitimate.


This scam is not just targeting money, but it is also after your personal information in an attempt to steal your identity. You should be cautious of any phone call, text message, email or letter about a tax refund or debt, especially if you weren’t expecting it.


The ATO would never send taxpayers an email or SMS asking them to click on a link to provide login, personal or financial information, or to download a file or open an attachment.

The ATO will also not use aggressive or rude behavior, or threaten you with arrest, jail or deportation, nor request payment of debt via iTunes or Google Play cards, prepaid Visa cards, cryptocurrency or direct credit to a personal bank account. It will also not request a fee in order to release a refund owed to a taxpayer.


New flexible business test for tax losses introduced



A bill has been passed that will see the ‘same business test’ supplemented with a more flexible ‘similar business test’ for the purposes of working out whether a company’s tax losses and net capital losses from previous income years can be used as a tax deduction in a current income year.


The rules will apply to income years starting on or after 1 July 2015.

The ‘similar business test’ will still be required to meet four factors:

- The extent to which the assets used to generate income was also used formerly

- The extent to which the activities and operations were also the same as the previous business

- The identity of the current business and the identity of the former business

- The extent to which any changes to the former business resulted from the development or commercialisation of assets, products, processes, services, or marketing or organisational methods, of the former business


The new measure will be helpful for start-up and innovation companies, who are often more prone to losses and changes of ownership.


The similar business test is a little bit more flexible and it ensures that if your activities are similar income producing activities or similar assets, then you can pass the similar business test even if the business is not identical to the one that was carried on prior to the losses being made.


Fuel tax credit rates raised



Rates for liquid fuels and blended fuels for heavy vehicles traveling on public roads from the 4th of February have increased to 15.8 cents per litre from 15.4. While all other business uses will see rates rise to 41.6 cents per litre up from 41.2 cents.