Institute of Certified Bookkeepers

ATO has confirmed the approach by employers who may be awaiting the CashFlow Boost and also have outstanding debts to the ATO:

ICB asked:

I would like to call out the situation that some businesses are now in

They believe they are eligible for CFB.

They have not paid any or all their March BAS because the CFB should be offsetting the amount due to be paid.

It is now the 27th May so technically their amount due is overdue.

This non-payment cannot in any way at any time in the future be taken into account for any consideration of the status of this business for future tax plans or anything really.

They are not late in paying (noting the partial payments etc and different scenarios).  They are not late in paying due to any fault of their own.

It is ATO administration of the CFB that is taking time to process that means there is a balance outstanding.

Where to from here?

Could ATO please confirm that they will put in place for enduring policy that late payment of March BAS will  not be a trigger ever for a different treatment of the Tax Payer?  Confirmation in writing of this policy would be good.

ATO Response:

The ATO is actively reviewing entitlements to the cash flow boost (CFB). We may conduct internal integrity checks or request further information from the entity to determine the entity’s eligibility to receive the cash flow boost payment and in certain circumstances there may be a delay.

In these situations, the ATO has communicated (or will communicate) this to the client in a letter regarding the payment of their BAS or the request for further information.

If the client believes the CFB payment will:

·        offset the entirety of their BAS liability, they should seek a deferral of payment. 

·        partially offset their BAS liability, they should pay the expected net amount and seek a payment plan for the balance. 

If the client is uncertain of the amount to pay or if they are unable to make a payment, we recommend the client contacts the ATO so we can gain an understanding of their circumstances and provide the support and assistance required. The ATO has and continues to provide significant support for taxpayers in response to the challenges they are facing because of the Covid-19 pandemic. Depending on their circumstances, the support we may be able to provide to the client includes:

  • Deferral of recovery action, (except for high risk clients, such as fraud or illegal phoenix activity)
  • Payment deferrals
  • Low interest payment plans 
  • Remission of GIC.

Furthermore, the ATO’s general policy regarding our general debt collection powers and principles is contained in PSLA 2011/14. This policy states that we will also consider the factors or circumstances which led to the inability to pay, and could include considering what circumstances led to a client being uncertain of the amount they need to pay.

It should be noted the ATO has currently paused its firmer collection actions (apart from the highest risk cases) and our focus is to provide support and assistance to taxpayers in relation to outstanding liabilities.

  • 9 June 2020