More reporting requirements under ABN changes
JOTHAM LIAM | MY BUSINESS
Originally published by My Business on April 05 2019
Australian Business Number (ABN) holders would be required to lodge their income tax return and confirm their details on the Australian Business Register annually, under the government’s proposal.
From 1 July 2021, ABN holders with an income tax return obligation would be required to lodge an income tax return.
Then from 1 July 2022, ABN holders will need to confirm the accuracy of their details on the ABR annually, to avoid cancellations by the ATO.
Currently, ABN holders are able to retain their ABN regardless whether they are meeting their income tax return lodgement obligation or the obligation to update their ABN details.
The new conditions, revealed in the federal budget, come after a Treasury consultation paper last year considered a reform to the ABN system to ensure information was up to date, with possible renewal fees discussed.
This measure is estimated to have a gain to the budget of $22.2 million over the forward estimates period.
BDO national tax director Lance Cunningham said that he was pleased to see the government land on a “sensible” system of regulating ABN holders instead of imposing fees.
“The requirement to lodge a tax return already applies to almost all ABN holders and most of the information that would be required for a ABN renewal is provided in the tax return, or if it is not, it would be a simple matter of including a request for such information in the tax return for relevant taxpayers,” Mr Cunningham told My Business sister title Accountants Daily.
“The tax return lodgement system is already in place, so it makes sense to utilise this system instead of establishing a new ABN renewal system. It would also act as an incentive for ABN holders to lodge their tax returns within the lodgement periods or apply for extensions of time to lodge.
“If you are doing the right thing then you haven’t got any problems.”