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04/08/2006
Workload Submission - A Letter to the ATO
The following is a letter to Mr Murray Crowe, Assistant Commissioner of the ATO in regards to a bookkeepers workload from Mr Matthew Addison, Executive Director of the Institute of Certified Bookkeepers.
To print a copy of this letter, please click here
3 August 2006
Mr Murray Crowe
Assistant Commissioner
Australian Taxation Office
Constitution Avenue
CANBERRA ACT 2600
Dear Mr Crowe
A SUBMISSION
DEADLINES / WORKLOAD of BOOKKEEPERS
We write to raise a major area of concern in the ability of business within Australia to fulfil their many compliance obligations during the July - August period. Our members, Bookkeepers, together with other accounting professionals assisting business, are under immense pressure during this period.
We, together with our members, are concerned that the numerous requirements result in a limited amount of time being available to conduct all duly correct procedures and processes in order to produce accurate and quality information, which is required for submission to government.
During the period of late June through to mid August a business in Australia must adhere to the following regulatory requirements in order to meet their obligations and avoid penalties or prosecution:
1) Superannuation obligations for the year to be checked, reconciled and reported.
2) Final quarters superannuation to be paid before 30 June in order to receive tax deduction
3) Alternatively, Superannuation amounts to be reconciled, paid and notified before 28th July in order to avoid penalty.
4) Final employee pay for the financial year.
5) End of year reconciliation of payroll, preparation of Payment Summaries and submission to ATO of yearly reconciliation.
6) June Quarter BAS or IAS by 28th July.
7) Preparation of end of year financial information, in conjunction with BAS work etc
SUBMISSION
A) BAS for the June Quarter: Allow this final year BAS to be lodged up to 28th August.
To provide an instant substantial assistance to bookkeepers and their clients, this extension would radically alter the timeframe required for completion of a substantial amount of work.
The ATO currently has altered the submission date for the December quarter BAS until 28th February based on business holidays during January. this precedent acknowledges real life circumstances. the immense compliance workload of small businss and its advisors during this period would be eased if this extension was provided on an ongoing basis.
Impact: Timing of receipt of the BAS & therefore payment of the BAS amounts.
B) Superannuation Obligations: Allow the tax deduction in the year “incurred” as long as paid in accordance with SGC requirements i.e. 28th July.
Every business prefers to receive a tax deduction in the year the expense is incurred. Normal business process (and tax law) for most business expenses allows a tax deduction where the expense has been “incurred”. The obligation on a business to pay its SGC obligation of 9% super has definitely been “incurred” at the time of making the employee payments.
However due to the ATO requirement that the superannuation for employees must be “paid” in order to get the tax deduction, more work is being required in the peak week or fortnight of the year.
Impact: less work in the last fortnight of the financial year.
Superannuation payment may be received by the superannuation funds in July instead of June.
Effect of the taxation timing in the hands of the superannuation fund.
Why do this?
The workload of professionals who help small business in meeting their end of year obligations would be allowed over a slightly more extended timeframe, thereby allowing more effective quality processes to be followed for each task, resulting in more accurate reporting.
The timetable would become:
Latter weeks of June
– Final payroll, preparation of payment summaries
July
- final reconciliation of payroll including submission of ATO reconciliations
- reconciliation and payment of SGC obligations
August
- BAS
Please consider the above with the aim being to permanently alter the BAS lodgement date for the June Quarter leading to a better quality of information provided.
Yours faithfully
Matthew Addison
Executive Director
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