With the bushfire ravaging parts of Australia throughout December and January, the ATO has expanded and extended the relief initially announced in November.
Approximately 3.5 million businesses, individuals, and self-managed superannuation funds in identified areas (see the list of affected postcodes) have been granted special concessions and relief by the ATO:
- An automatic extension until 28 May 2020 to lodge and pay activity statements, income tax, SMSF and FBT lodgements.
- The deferral does not apply to:
- Superannuation guarantee payments or lodgements.
- Large PAYG withholders (although they will be assessed on a case by case basis if they apply for relief from the ATO).
- Fast tracking of refunds due.
- Tax debt recovery on hold until 28 May 2020.
- Impacted taxpayers need to apply for special consideration. The ATO has stated they will, “consider releasing individuals and businesses from income tax and fringe benefits tax debts if they are experiencing serious hardship.”
- Interest and penalties accrued by taxpayers in affected areas since the bushfires commenced will be remitted
- Income tax instalments able to be varied to nil without penalty.
If clients are not in one of the identified postcodes but have been impacted by the bushfires, relief might still be available.
The ATO will continue to assess the impact of the bushfires and will keep the community informed as it receives more information on additional impacted postcodes and available support.
Federal and State governments have announced a range of bushfire support measures including payments and low-interest loans available for businesses that have been affected. While we will need to wait until the relevant legislation is enacted, at a high level, the Government has indicated that these payments are intended to be exempt from income tax.