On Friday 6 September 2013, Tax Counsel Stephanie Caredes attended a meeting of the ATO Tax Practitioners Advisory Group. Following the meeting, the ATO has issued these key messages:
Maintain security in your practice to stop fraud
Tax practitioners are encouraged to remain vigilant to identity crime which can lead to concerns not only in the tax system but for the broader financial community as well.
Tax practitioners are in a trusted position within ATO online systems, and that brings an obligation to mitigate additional risk arising from online access to ATO information and services.
Taxpayer information must be kept safe at all times. Attention to proper security procedures, especially during busy periods, will help mitigate the risk of identity crime and potential fraud.
The following tips will help protect your clients' information:
- Undertake proof of identity checks for new clients;
- Perform regular reviews of your AUSkey credentials;
- avoid sharing passwords and login details ;
- change passwords and remove user access when a staff member leaves;
- lock computer screens when leaving desks ;
- secure tax records when they aren't in use;
- avoid circulating tax file numbers in emails unless it's absolutely necessary;
- ensure your computers have up-to-date security software, including anti-virus, anti-spyware, anti-spam and firewall protection.
The ATO have a range of practical suggestions to help reduce the potential for you or your staff being unknowing accomplices to identity crime and refund fraud. For more information, refer to Reduce the risk of refund fraud in your practice and Proof of Identity Checks at www.ato.gov.au.
The ATO acknowledges some teething problems with the move to the new website. The ATO is listening and responding to feedback, and has dedicated resources to expedite the resolution of issues.
The ATO will continue to work with the professional associations to identify problems with the website and under the new consultation arrangements will set up a limited life working group to facilitate this. We will communicate the progress on known problems via the systems issues pages on www.ato.gov.au
The new lodgment program framework, developed in consultation with the Lodgment Working Group, requires agents to lodge 85% of their clients’ income tax and FBT returns on-time. Returns need to be lodged electronically in order to receive lodgment program concessional due dates.
2012-13 was a transitional year aimed at increasing agents’ awareness, understanding and knowledge of the new Lodgment Program framework before the planned implementation starting date of 1 July 2013.
During the transition to the new framework, there has been an increase in income tax returns lodged on time. 92% of income tax returns lodged by tax agents for 2011-12 were lodged on-time, increasing from 83% in the previous year. These figures do not include expected lodgments.
The number of tax practitioners meeting the 85% standard of the Lodgment Program has increased by 32.5% (9,223 to 12,229) from the previous year.
The total number of agents who achieved below 65% for the 2012-13 Lodgment Program year was reduced by 10% (3,277 to 2,961).
The number of paper income tax returns lodged by tax agents in 2012-13 has decreased by 16% (127,564 to 107,653) from the previous year.
The number of agents lodging paper returns in 2012-13 has reduced by 10% (3,857 to 3,451) from the previous year.
Paper Activity Statements and EFT Refunds
The ATO is planning to stop issuing paper activity statements to clients or their representatives if the previous statement was lodged via the Electronic Lodgment Service (ELS), the Tax or BAS Agent Portals, the Business Portal, Standard Business Reporting, or the Electronic Commerce Interface. The only exclusions are the annual GST Information Report form Q and Instalment Notice forms R, S and T.
The ATO has consulted and conducted pilots with tax and BAS agents to understand the impacts on removing paper activity statements. Feedback from the pilots has been used to develop solutions and support materials to assist the broader rollout.
An extensive communication strategy is under development and will commence prior to the change. Tax practitioners are encouraged to start preparing their business practice to operate without the paper activity statement and ensure that a valid email address has been provided for your clients’ activity statement role.
From 1 July 2013, Australian bank account details were required for all individual income tax returns lodged via ELS and e-Tax where a refund is estimated.
For the 2013-14 financial year, the ATO is extending the same EFT requirements to the following forms:
- Company Tax Return;
- Trust Tax Return;
- Self-Managed Super Fund Annual Return;
- Fund Income Tax Return;
- Fringe Benefits Tax Return;
- Application for refund of franking credit; and
- Strata title body corporate tax return.
Tax practitioners are encouraged to start preparing their business practice to operate without cheques being issued for non-individual tax returns.
In addition to the above key messages from the ATO, we note the following for Members’ information:
- ATO website – the external members highlighted various of the recurring issues with the ATO website including broken links, issues with the search functionality, the absence of the “Printer friendly” option for printing documents and issues with the “What’s new” function (to which the ATO recommends subscribing to the RSS feeds instead). The ATO advised they are working to restore the print friendly function. The ATO advised they are working to address the problems with the website and that people are encouraged to notify the ATO of particular issues they are experiencing with the website.
- ABR Website – some further changes will be made to the ABR website later this year expanding the type of information that will be maintained on the Australian Business Register.
Members who seek further information in relation to any of the above should contact us at Tax Policy.