Tax Support For Businesses and Not For Profits

How to get help if your business or not for profit can’t pay tax or super on time.

When can you access help?

If your business is having financial difficulties and can’t pay tax or super on time, support is available.

Financial difficulties can occur from many situations, including:

• business closure
• disconnection of an essential service, such as electricity
• repossession of a vehicle that is used for business purposes
• pending legal action for non-payment of debts
• period of review limitations
• court orders
• settlements
• other necessities for the business or people you are responsible for.

Support for your situation

Depending on your circumstances, the ATO may be able to give you extra time to lodge or pay your tax, or remit penalties or interest which may apply.

For support tailored to your needs, speak to your registered tax practitioner or call the ATO on 13 11 42 during operating hours. To provide you with help, the ATO may ask for evidence that your business is in financial difficulty.

Priority processing of tax returns

If your business is experiencing financial difficulties, you may be eligible for priority processing of your tax return.

You can apply for priority processing by phone or through a tax professional.

Adjusting GST registration and reporting

If your GST turnover is less than $75,000 (or $150,000 for non-profit organisations), you may be able to:

• cancel your GST registration – your fuel tax credit, luxury car tax and wine equalisation tax registrations will also be cancelled
• remain registered, but report and pay your GST annually or monthly
• continue with your current registration and reporting option.

Call the ATO on 13 28 66 during operating hours if you need to change your GST reporting and payment cycle.

Payment plans

It’s important to lodge on time. Lodging on time means you can understand your tax position.

If you can’t pay the amount you owe in full and on time, you may be eligible to enter a payment plan. A payment plan allows you to break down your payment into smaller amounts that are made via instalments. It should be spread over the shortest possible fixed period of time to minimise general interest charge (GIC) that will continue to accrue.

Varying your PAYG instalments

You can vary your pay as you go (PAYG) instalments so the amount you prepay is closer to your expected tax for the year.

If your business income is reduced, you can lodge a variation on your next BAS or instalment notice.

Your varied amount or rate will apply for all your remaining instalments for the income year, or until you make another variation. We encourage you to review your PAYG instalments regularly, so the amount you prepay is closer to your expected tax for the year.

Call the ATO on 13 28 61 during operating hours to discuss your PAYG instalments.

Help managing employee super payments

By law, the ATO can’t vary the super guarantee (SG) contribution due date or waive the super guarantee charge (SGC) for late payments of SG.

You must pay SG to the super funds of all eligible workers at least 4 times a year, on or before the SG payment due dates. SG contributions are only considered ‘paid’ on the date it is received by the super fund. After this you are liable for the SGC.

Unlike paying SG on time, the SGC is calculated on an employee’s total salary and wages (including overtime and some allowances) and includes interest and an administration fee of $20 per employee, per quarter.

If you don’t pay the minimum amount of SG to the correct super fund on time, you need to:

• lodge a Super guarantee charge (SGC) statement
• pay the SGC to the ATO.

You will avoid additional penalties if you lodge the Super guarantee charge (SGC) statement within a month of the quarterly due date. If you can’t pay in full, we’ll work with you to set up a payment plan.

We have limited discretion with interest and penalties that apply to unpaid super. Contact the ATO as soon as possible and, importantly, lodge a SGC statement.

Discretion not to offset

If you have a debt with us, we’re required by law to pay off the debt using any credits or refunds you become entitled to. This is known as offsetting.

There are limited circumstances in which we have the discretion not to offset. If you are in serious financial hardship, we may be able to pay the refund to you instead.

You can find out more in PS LA 2011/21 Offsetting of refunds and credits against taxation and other debts.

Help paying if your funds are frozen

If you can’t meet your tax payments due to freezing of income or non-bank funds, you may be able to pay your tax by instalments. Otherwise, you may be eligible for a payment deferral.

The Australian Securities & Investment Commission (ASIC) can help people who have frozen funds and are in financial difficulty.

If you’re in this situation, follow these steps:

• Call the ATO on 13 11 42 during operating hours to discuss.
• Contact ASIC to facilitate frozen funds and hardship withdrawalsExternal Link.

Where to get financial advice on managing your business

The ATO are committed to providing you with reliable advice and information about your tax obligations and rights as a business operator. However, the ATO can’t offer financial advice.

For financial advice, you can contact:

• a tax practitioner
• a financial adviser
• an accountant
• a professional association.

Make sure any advice you receive comes from a licensed financial adviser.

You can also:

• Check the ASIC public register to see if the person you are speaking to holds the necessary licences
• Call the ATO on 13 28 66 during operating hours if you would like to talk to us about your tax and super obligations.
• For financial tips and safety checks, visit the ASIC’s Money Smart website or call 1300 300 630.

Free financial counselling services

Financial counsellors provide information, support and advocacy to assist people in financial difficulty. Their services are free, independent and confidential.

The National Debt Helpline (NDH) is an online and phone financial counselling service available across Australia. NDH counsellors talk to people with debts. They explain what options are available. This may include referral to your local financial counselling service. Call the NDH on 1800 007 007.

Evidence of financial difficulty

The ATO may ask for evidence that your business is in financial difficulty. This will support your claim.

Evidence may include:

• a current bank notice
• other bank notices (for example, an overdraft call)
• an eviction notice
• a disconnection notice
• a repossession notice
• a notice of impending legal action
• staff pay records
• contract payment schedules
• legal documents.

We take many factors into account when assessing your claim.

In some cases, the ATO’s requirements may change. This will depend on your circumstances.

If you’re experiencing financial difficulty, contact the ATO.

Source: ATO