Over the holiday period we will be closed from 5pm Thursday 19 December and will re-open 9am Monday 6 January. We would like to wish you a Merry Christmas, hope that you have a safe holiday season and wish you all the best for 2020.
Electronic Signing of Annual Solvency Resolution
We have started using a new program to manage all of the annual ASIC company statements. You will start to see these coming to you in a slightly different format with the annual solvency resolution to be signed electronically via DocuSign. Should you have any issues with the process of signing the resolution electronically, please call the office for assistance.
Taxable Payments Annual Report Extended to More Industries
Businesses that operate in the road freight, security, and investigation, surveillance and information technology (IT) industries are required to lodge a Taxable Payments Annual Report for the first time by 28 August 2020. Details are required relating to payments made to contractors.
These industries join the other industries which are already required to lodge these reports:
- Building and Construction Services
- Cleaning Services
- Courier Services
The details of payments to contractors that you are required to submit include:
- ABN (where known)
- Business name or individual's name
- Total amounts for the financial year of the gross amount paid (including GST plus any tax withheld), total GST you paid the contractor and total tax withheld where ABN was not quoted.
If you are required to prepare this report and you require assistance in the establishment of a system to ensure that the report can be prepared promptly in August 2020, please do not hesitate to contact us.
ATO "Carrot and Stick Approach"
The Australian Taxation Office (ATO) administers the taxation system and collects the revenue for the Australian Government. For many years the "carrot approach" was the favoured option. In recent years ATO officers have been rarely encountered as they focused on data matching audits and behind the scenes desk audits without much face-to-face interactions.
In 2019 the ATO started taking a different approach, the "carrot and stick" approach. In particular, there has been more site visits and the new and improved Tax Integrity Centre has been used much more. In the last 12 months ATO officers have visited 45 different locations throughout regional and remote areas of Australia and, in each of these areas, the officers have visited several hundred businesses including cafés, restaurants, hair and beauty salons, carpenters, hotels and motels.
The locations that have been selected and the businesses visited are because the ATO is receiving telephone calls from the public relating to allegations that some businesses are demanding cash from customers, not providing tax invoices and allegations that they are not declaring all of their income in their taxation returns. These allegations are reviewed by the Australian Taxation Office Tax Integrity Centre which is the single point of contact for the public to report on suspected tax evasion and black economy activity. The Tax Integrity Centre also receives details of allegations of other matters including, cash in hand transactions, underpayment of wages, visa fraud, identity fraud, sham contracting and more.
The Tax Integrity Centre hotline has only been in operation since 1 July 2019 and it has already received over 15,000 telephone calls (230 per day) with the main allegation relating to business people not declaring income, workers being paid cash in hand, allegations that people are living beyond their means compared to their "business profitability".
Every legitimate business needs to be aware of who they are dealing with and, if their competitors are playing on a level playing field. If you have any suspicions you can now contact the ATO Tax Integrity Centre to outline your concerns.
However, the other problem is people can and may put spurious claims in about your business and you will need to be prepared in case you receive a call from the ATO relative to these allegations.
If you have any concerns relating to any business activities of other businesses that you believe should be reported to the ATO but you would like to discuss your concerns before lodging a complaint, please don't hesitate to contact us.
Franchise Industry Review
The Australian Government's Small Business and Franchise Ombudsman, Kate Carnell, is urging all business operators involved in the franchising Industry to provide feedback to the Australian Government Regulation Impact Statement (RIS) by 6 December 2019 - https://docs.employment.gov.au/node/47088
"The release of the RIS gives the franchising sector the chance to create meaningful reform. It is crucial that small businesses in the franchising sector get involved in this consultation process to ensure their voices are heard" Ms Carnell said.
"Small businesses that want to have their say in the future of the franchising sector can access the RIS online and make a submission."
"It is essential we see affective and timely reform in the franchising sector that is squarely focused on fairness and creating mutually beneficial business relationships".
The release of the RIS follows the release of the government's "Fairness in Franchising Report" earlier this year.
The Ombudsman has indicated that there are 97,000 franchise businesses in Australia which employ close to 600,000 people.
Prepare Now for the Decade of Change
The commentary in this edition and the previous edition on Execution of Strategies could become part of your key theme for looking at the business challenges that are going to confront virtually every business over this decade of the 20s.
The government has laid out various ways that small and medium-sized enterprises can now finance their businesses with a significant amount of funding being possible from raising capital direct from the public.
We have included a comment from an academic/researcher who has quite correctly identified that businesses just don't need cash! To be successful and to grow your business and to have the ability to raise capital direct from the public, businesses need to have implemented the other key components relating to:
- Execution of Strategies
The 20s will be a decade of change – if you wish to prepare now for the decade of change we will be happy to have discussions with you and to assist you on this journey.