From the ATO – Easier to pay your tax bill – Check your business PAYG instalments – Shareholder loans – STP reporting.

Easier to pay your tax bill

The ATO has improved how your business can use and manage its credit or debit card details in Online services for business, making it easier to pay a tax or super bill.

The new payment features allow your business to:

  • add and manage up to three credit or debit cards in its account profile;
  • set up a payment plan with automatic direct debits from a card;
  • make one-off payments using a card.

Online services for business offers a simplified process to make it easier to create a payment plan if your business owes less than $100,000.

If you’re worried your business will have difficulty paying on time, or are having trouble setting up a payment plan online, you can contact the ATO on 13 11 42 for help (or talk to Southern Business Solutions).

Check your business’ PAYG instalments

Now is a good time to check your business’ pay as you go (PAYG) instalments still reflect its expected end of year tax liability.

If the business’ circumstances have changed and you think it will pay too much (or too little) in instalments for the year, the instalments can be varied on the next activity statement.

Instalments can be varied multiple times throughout the year. The varied amount or rate will apply for the remaining instalments for the tax year or until another variation is made.

If your business is affected by COVID-19, the ATO has said it will not apply penalties or charge interest to varied instalments relating to the 2020–21 tax year. This applies when the business has made its best attempt to estimate its end of year tax liability.

If an amount or rate is varied online, paper activity statements and instalment notices will no longer be issued. These will be issued electronically. Your business will need to consider this when deciding how to lodge, revise and vary future activity statements and instalment amounts.

Tip! Registered tax agents and BAS agents can help you with your business’ activity statements and tax returns.  Call Southern Business Solutions.

Shareholder loans – minimum yearly repayments

If you have a loan from a private company you control (or from an interposed entity) and a complying loan agreement is in place, you must make a minimum yearly repayment by the end of the company’s income year throughout the loan term. Failure to do so may result in your being taken to have received an unfranked dividend.

The ATO realises that, as a result of the COVID-19 pandemic, some borrowers are facing difficult circumstances beyond their control. If you are in that situation, and were unable to make the minimum repayment for 2019–20 by the due date (30 June 2020 in most cases), the ATO will look favourably on a request to extend the repayment period (up to 30 June 2021). Note the minimum yearly repayment for 2020–21 is due as normal by 30 June 2021.

You can request an extension by completing a streamlined online application form.

STP reporting: Changes from 1 July 2021

If your business has employees, it should be reporting through Single Touch Payroll (STP) unless it only employs closely held payees or is covered by a deferral or exemption.

There are some changes to STP reporting from 1 July 2021:

  • small employers (less than 20 employees) with closely held payees must report their closely held payees through STP. You can choose to report these payees each pay day, monthly or quarterly;
  • the STP quarterly reporting concessions for micro employers (less than 5 employees) will only be available to employers who meet certain eligibility requirements, including the need for exceptional circumstances to exist. Employers can apply for this concession through the online deferral tool from 1 July 2021.

A closely held payee is an individual directly related to the entity from which they receive payments, e.g.:

  • family members of a family business;
  • directors or shareholders of a company;
  • beneficiaries of a trust.

Further changes will start on 1 January 2022. We will advise you of those nearer the date.

Tip! Talk to Southern Business Solutions if your business has employees and it has not started reporting through STP but does not have a deferral or exemption. It needs to start reporting now.

Ref: TaxWise Business News April 2021

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