Growing business, growing responsibilities

Learn about ATO’s current focus on small businesses with a turnover between $1 million and $10 million.

ATO wants to ensure growing small businesses understand their tax and super responsibilities, particularly when it comes to accurately reporting all income and claiming deductions and offsets.

ATO is detecting and addressing recurring errors in specific industries when businesses have a turnover between $1 million and $10 million, these industries include:

• property and construction – including builders, contractors and tradies
• professional, scientific and technical services – including engineering, design, IT and consulting professionals.

ATO knows most small businesses want to do the right thing. However, in these industries we continue to see recurring issues, including:

• incorrect claims for the research and development tax incentive offset, especially for activities that don’t meet the eligibility criteria
• omitted sales and income in BAS and tax returns, including income from related entities
• overclaimed expenses and GST credits
• private expenses incorrectly reported as business-related, or not properly apportioned between business and personal use
• failure to register for GST when required
• not seeking independent advice from a registered tax agent, particularly in head contractor/subcontractor arrangements.

If you run a small business in property and construction or professional, scientific and technical services, it is important to ensure you are reporting correctly and meeting your obligations. By sharing what we are seeing in these industries, we want to help you avoid common errors and get it right from the start.

For more information, visit ATO’s focus areas for small business.

For small businesses struggling to meet their obligations, it is important not to ignore the problem but to seek assistance, whether that is from RA Advisory’s registered tax agent, a business adviser or us directly. ATO has a range of help and support available, visit Supporting your small business.

For tailored advice about your tax and super needs, speak to our registered tax agent.

Source: ATO