Yahoo Finance ATO’s $50bn warning to 60,000 businesses
As many as 60,000 Australian businesses haven’t complied with tax lodgment requirements, and it’s costing the economy $50 billion, the Australian Tax Office has said.
The money lost from businesses doing cash deals, and as such not paying tax, is equivalent to 3 per cent of Gross Domestic Product, ATO Assistant Commissioner Peter Holt said.
He said 60,000 businesses haven’t lodged returns under the taxable payments reporting system (TPRS) for 2019/20. The ATO uses the TPRS to identify contractors who fail to accurately report their income.
“As any good tradie will tell you, the spirit level is a critical tool to ensure construction work is being done on the level. I like to think of the TPRS as a bit of a spirit level for tax obligations. Our role is to make sure the “bubble” is centred as much as possible to keep things on the level and fair for everyone”, Mr Holt said.
All up, around 280,000 businesses need to lodge a Taxable payments annual report (TPAR) for the 2019/20 period.
Businesses that haven’t done so yet, must lodge as soon as possible to avoid penalties.
And, Holt added, many businesses that are required to do so are unaware of their obligations.
“Many restaurants, cafés, grocery stores, pharmacies and retailers have started paying contractors to deliver their goods to their customers. These businesses may not have previously needed to lodge a TPAR. However, if the total payments received for these deliveries or courier services are 10 per cent or more of the total annual business income, you’ll need to lodge,” Holt said.
“We have welcomed the collaborative way the building and construction industry has continued to work with the ATO to ensure the success of the TPRS, through regular engagement with head contractors across the industry.”
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