What is the ATO doing?
PAYG instalment variations
The ATO will allow businesses impacted by COVID-19 to vary PAYG instalment amounts as from the March 2020 quarter.
A quarterly PAYG instalments payer can vary their PAYG instalments on their BAS for the March 2020 quarter. This can be done by lodging a revised BAS before an instalment is due, and before the business lodges its income tax return for the year.
Businesses that vary their PAYG instalment to zero can also claim a refund for any instalments made for the September 2019 and December 2019 quarters.
Changing to monthly reporting
The ATO will allow businesses on a quarterly reporting cycle to opt into monthly GST reporting to get quicker access to any GST refunds. Changing the GST reporting cycle to monthly doesn’t mean that a business has to change its PAYG withholding reporting cycle. Rather, business can manage this by specifying the roles it is changing.
Once a business chooses to report and pay GST monthly, the ATO says it must keep reporting monthly for 12 months before it can elect to revert to quarterly reporting.
Other ATO administrative measures to assist businesses impacted by COVID-19 are:
- deferring by up to 4 months the payment of BAS amounts (including PAYG instalments), income tax, FBT and excise;
- remitting any interest and penalties, incurred on or after 23 January 2020, that have been applied to tax liabilities; and
- allowing affected businesses to enter into low-interest payment plans for their existing and ongoing tax liabilities.
These assistance measures will not be implemented automatically by the ATO (unlike the relief measures for the 2019-20 bushfires – see below). Therefore, if you are an individual, sole trader, small or medium business and you need further assistance managing your tax and super obligations, contact the ATO Emergency Support Infoline (tel: 1800 806 218) or talk to your tax agent. Once you or your agent contacts the ATO, a support plan will be tailored for you.
The ATO has set up a “one stop shop” on its website for essential tax and super info on Coronavirus stimulus measures.
Ref: TaxWise Business April 2020