If the introduction of Single Touch Payroll (STP) wasn't a big enough challenge, small businesses can now look forward to the arrival of e-invoicing and changes to the Superannuation Guarantee (SG) rules.
Here's a roundup of some of the latest tax developments:
E-invoicing to be rolled out
Small businesses can look forward to increasing use of e-invoicing following the ATO's appointment as the local Peppol authority. Currently being used in 34 countries, the Peppol framework provides a standardised e-invoice for both domestic and international trade.
With e-invoicing, invoices are directly exchanged between the supplier's and the buyer's accounting systems - even if they use different software.
According to the ATO, by adopting e-invoicing businesses of all sizes can expect to see improved cashflow and quicker payments, easier processing and cost savings, fewer errors and reduced risk of compromised invoices.
The ATO will now work with digital service providers to deliver a range of e-invoicing products for local businesses.
Inactive ABNs will be cancelled
Inactive Australian Business Numbers (ABNs) are an increasing area of interest for the ATO. If the tax man believes your business is no longer carrying on an enterprise, you face the risk it could decide to cancel your ABN.
To determine if an ABN is still being used, the ATO is checking the ABN holder's tax return, whether their compliance and lodgment documents are up-to-date and a range of third party information.
If your ABN is mistakenly cancelled, you can reapply for the same ABN if your business structure remains the same. But if the structure is different - such as a sole trader now operating as a company - you will receive a different ABN.
Rule change for salary sacrifice and SG
Legislation to prevent employers from using employee salary sacrificed amounts to reduce their minimum Superannuation Guarantee (SG) payments has passed Parliament and will apply from 1 July 2020.
The new rules mean an employer can no longer count the amount salary sacrificed by an employee as part of the amount the employer is required to pay in SG contributions.
Also, the base amount on which SG contributions are calculated can no longer be reduced by any salary sacrificed amounts.
Limiting deductions for vacant land
Tax deductions for losses or outgoings (such as interest costs) incurred when holding vacant land not genuinely being used to earn assessable income have been reduced under new legislation.
The changes limit the claimable deductions for holding vacant land on or after 1 July 2019 - even if the land was held prior to that date.
Tax deductions are not affected if the land is held by a corporate tax entity, used for carrying on a business, used for primary product and leased, or where exceptional circumstances have affected a permanent structure on the land.
ATO tip-offs on the rise
Small businesses in the café and restaurant industry are more likely to be subject to a tip-off and subsequent investigation by a specialised team, according to the ATO's Tax Integrity Centre (TIC).
There are also high volumes of tip-offs about black economy behaviour in the hairdressing and beauty, building and construction, and cleaning industries.
The TIC is receiving 230 tip-offs a day about black economy activities by small businesses such as undeclared income, paying workers cash in hand and not reporting sales.
Tax man focussing on SG compliance
With the ATO currently checking SG contribution payments for around 400,000 employers for the 2018-19 financial year, small businesses will need to stay in top of their obligations in this area.
The ATO is now "heavily focussed on reducing the incidence of non-payment of SG" courtesy of new Single Touch Payroll information, according to deputy commissioner, James O'Halloran.
With an "unprecedented level of 'visability' of super information at the account and transaction level", the ATO plans to increase checks of SG payments and follow up employers not paying on time.