SME Tax Changes 2020: Guide for Busy Business Owners


Business owners are time-poor, and tax updates are boring – so here’s very quick summary to flag any changes that might impact your business in 2020. We recommend you get in touch with your tax agent if you’d like more details, especially on how these changes will apply to you.  


Single Touch Payroll (STP)

We’ve covered this one a lot in the last twelve months, but STP is officially here and it needs to be set up correctly!

Some employers have resisted migrating to STP out of confusion, frustration or simply not having it as a priority. However, if your business is eligible for STP and you haven’t adopted it yet - now is certainly the time, or the ATO may be knocking on your door to follow up.

Penalties already apply to larger employers from the beginning of the 2019-20 Financial Year. Penalties for small business (less than 20 employees) will kick in from 30 June 2020.

Find out more:

Click here to read more about setting up your business on STP.

Click here to book a STP consultation with us!

 

Goodbye AusKey

AusKey will no longer be used as a reporting method from 1 April 2020.

MyGovID and Relationship Authorisation Manager (RAM) are replacing the old AusKey system, and will be used to send business information to the ATO.

After 31 March, businesses will need to link their ABN to their myGovID in order to access business services.

Find out more:

The ATO has instructions and tutorial videos on their website. If you would like one-on-one help setting up your MyGovID or RAM, get in touch.

 

TPRS expansion

The Taxable Payment Reporting Systems (TPRS) requires small businesses to report payments made to contractors to the ATO. It’s old news for builders, cleaners and couriers, however it’s going to roll out to other industries in 2020.

In the 2019-20 Financial Year, TPRS applies to road freight, IT, security, investigation and surveillance businesses, with the first TPAR - Taxable Payment Annual Report due by 28 August 2020.

It is applicable even if one of the above services is only part of your business activity and you don’t identify as operating within those particular industries. 

Find out more:

Read more on the ATO website, or book a meeting with us to discuss how it may directly impact you. 

 

Government E-invoicing

In 2020 the Federal Government will introduce their new e-invoicing structure.

This includes a commitment to pay all electronically supplied invoices from small business suppliers within five days – up to the value of $1 million.

E-invoicing won’t be compulsory for all businesses; however it does come with cash flow benefits.

Find out more:

We can provide advice on setting up e-invoicing for your business and other strategies for reducing debtor days and increasing cash flow. For more information on those services, get in touch.