Super Guarantee Amnesty Bill Passes Parliament
The Superannuation Guarantee (SG) amnesty bill has now passed both houses of parliament and is awaiting royal assent.
The SG amnesty provides for a one-off amnesty to encourage employers to self-correct historical SG non-compliance dating from 1 July 1992 to 31 March 2018. An employer will not be able to benefit from the amnesty for SG shortfall relating to the quarter starting on 1 April 2018 or subsequent quarters.
It will allow employers to claim tax deductions for payments of SG charge or contributions made during the amnesty period to offset SG charge, as well as remove the administrative component and the Part 7 penalty that may otherwise apply in relation to SG non-compliance. The amnesty period will start from 24 May 2018 and end six months from the date it receives royal assent.
The new legislation will also impose minimum penalties on employers who fail to come forward during the amnesty period by limiting the commissioner's ability to remit penalties below 100 per cent of the amount of SG charge payable.
Should you wish to discuss the amnesty further, please contact us.
Tax Relief for Bushfire Victims
The 2019/20 Australian bushfires have prompted an outpouring of support throughout Australia and around the world. It's easy to see why, considering the extent of the economic, environmental and personal devastation they have caused.
The Federal and New South Wales governments have now announced a raft of tax relief measures to ease the pressure on individuals, families and businesses affected by the bushfires. These measures are outlined below.
New South Wales Measures
- Lodgment dates and payment deadlines for NSW taxes, duties, grants and royalties may be extended. This may include time limits for lodging objections.
- Interest may not be charged on taxes, duties and royalties that are due and payable and arrangements can be made for payment of debts by instalments.
- The collection of fines and debts payable by people in bushfire affected areas will be temporarily halted and payment deadlines may be extended.
- If a motor vehicle was written off in a declared natural disaster, the owner may apply for a refund of motor vehicle duty paid on a replacement vehicle.
- Wages may be exempt from payroll tax if they are paid to an employee while they are absent from work and unable to perform work duties as they are carrying out emergency operations related to the bushfires. Revenue NSW has indicated outlining involvement with a letter to either the Rural Fire Services NSW or the NSW State Emergency Service which can serve as evidence for the exemption. Payments should be recorded as "emergency services leave".
- Driving sanctions and Work and Development Orders may be lifted or placed on hold if Revenue NSW or the relevant Work and Development sponsor is contacted.
Again, these measures should be available immediately but may not be applied automatically. Affected parties are encouraged to contact Revenue NSW.
The ATO has announced it is granting automatic deferrals for tax lodgements and the payment of tax debts by persons living in postcodes identified as being impacted by the bushfires (the announcement includes a full list of affected postcodes). The ATO's Emergency Support line is also available for those impacted by the bushfires, regardless of whether they reside in one of the unlisted postcodes.
Importantly, these deferrals do not exempt taxpayers from paying their debts or making required lodgements, they simply defer these obligations to a later time.
In addition, the Treasury Laws Amendment (2019-20 Bushfire Tax Assistance) Bill 2020 was introduced into parliament on 5 February 2020 and passed by both the House of Representatives and the Senate the following day. The Bill currently awaits assent and includes amendments to make government support payments to volunteer firefighters and all relief and recovery payments and benefits in relation to the 2019/20 bushfires tax exempt.
Affected payments include payments of Disaster Recovery Allowance relating to the bushfires and payments by the states or territories relating to the bushfires under the Disaster Recovery Funding Arrangements 2018. These amendments will apply retrospectively to the 2019/20 income year and to later income years.
Director Penalty Notices for GST Starting 1 April 2020
Parliament has just passed legislation to include GST in the Director Penalty Notice Regime, and it comes into effect on 1 April 2020.
To recap; A Director Penalty Notice is a Notice that the Australian Tax Office ("ATO") can send to a director that can make that director personally liable for, currently, two types of tax debts of a company – Pay As You Go ("PAYG") and Superannuation Guarantee Charge ("SGC") liabilities. The addition of Goods and Services Tax ("GST") to this list means the ATO will be able to pursue a company director personally for the majority of a company's tax debt.
The now passed version of the legislation makes the new powers to pursue GST forward reaching only - so the ATO can only chase GST debts incurred in the period starting 1 April 2020 or later with a DPN.
Our reading of the bill says the same 3 month lockdown rules that currently apply to PAYG will be applied to GST as well. The current lockdown rules state that if PAYG was reported more than 3 months after the due reporting date (or not at all) then the DPN is "Locked Down" which means placing the company into Administration or Liquidation will not remove the penalty.
With these changes to commence shortly, it is even more important that you stay on top of your ATO and SGC liabilities.
Surviving the Difficult Times
Australia has certainly been subjected to a wide range of challenges affecting everyone including farmers, small businesses, fishers, education facilities, tourist industry which encompasses a whole range of businesses including accommodation, restaurants, cafés, hotels, nightclubs, tourist attractions and transport etc. We have certainly had a double whammy recently with fire, floods, cyclones and now the COVID19 (formerly known as the Coronavirus).
To all of you who are suffering we extend our best wishes. There are various government programs that have been announced ranging from grants to special low interest loans. Please don't hesitate to contact us if you require assistance on the preparation of the government application forms or the additional information that many of these grants require you to submit.
If you are concerned about what is happening within your business and your industry, please feel free to contact us.
Research and Development - Registration
There are a number of deadline dates for research and development purposes occurring over the next few months. These are as follows:
- Registration of a company's research and development activities for which the company wishes to claim the R&D Offset must be lodged with AusIndustry within 10 months of the end of the financial year, which for a company with R&D expenditure in the financial year ended 30 June 2019, is the 30 April 2020.
- If your company has incurred R&D expenditure overseas in the current financial year (2019/20) for which the company wishes to claim an R&D Offset, then the company must submit an "Overseas' Finding" summarising the overseas' expenditure to the Australian Taxation Office prior to 30 June 2020.
- A company can submit a summary of a proposed research and development project to the Australian Taxation Office to gain approval that the expenditure will qualify for the R&D Offset so that the company has some certainty that the expenditure will qualify for the R&D offset. The "Advance Finding" must be submitted to the Australian Taxation Office before the end of the income year in which the activity was conducted.
If you have any questions relative to these research and development deadlines, please do not hesitate to contact us for a discussion.