The Commissioner of Taxation Chris Jordan announced that he has extended a package of tax assistance for people impacted by the recent devastating bushfires in New South Wales, Victoria, Queensland, South Australia and Tasmania as part of the whole-of-government response to the disaster.
Approximately three and a half million businesses, individuals and self-managed superannuation funds in impacted local government areas will now have until 28 May 2020 to lodge and pay business activity statements and income tax returns. Additionally, the Australian Taxation Office (ATO) is fast tracking any refunds that are due to taxpayers in the impacted regions. If you run a business and you’re expecting a refund for example as a result of GST credits due to large purchases to replace stock, the ATO is encouraging you to try to lodge your activity statements. Refunds generated by lodging may provide some helpful temporary cash flow relief during these difficult times. The ATO will also be remitting any interest and penalties applied to tax debts since the commencement of the bushfires that have been applied to accounts of individuals and businesses located in impacted regions.
For people who have had documents destroyed by the bushfires, the ATO is able to assist by reissuing documents it has on hand. For those taxpayers in affected areas with a tax debt or outstanding obligations, the ATO will not initiate debt recovery action until at least 28 May 2020. Additionally, taxpayers can request payment arrangements for outstanding debts. The ATO will also consider releasing individuals and businesses from income tax and fringe benefits tax debts if they are experiencing serious hardship. Affected taxpayers are also able to vary their income tax instalments to nil without penalties. This will apply if taxpayers end up in a tax payable situation for that quarter once they have lodged their tax return.
The ATO recognises the ongoing effects of this disaster, such as cash flow problems for business owners who have suffered reduced trade. This includes businesses that are not located in the identified regions.
For assistance, check the ATO’s website for natural disasters: ato.gov.au/NaturalDisasters. If you are struggling and need assistance, the ATO are encouraging people to talk to their accountant and BAS agent or to contact the ATO once you are ready to discuss your situation.
Contact Addept today on 08 8418 2111 if you have any questions on how we can help you with your tax obligations.