On Monday 4 April 2011, the Inspector-General of Taxation released his forward work program. The Tax Institute is very pleased that he has taken up our suggestion to review the use of the small business benchmarks in the cash economy audit program.
We know that the benchmarks are a problematic area for many of our members – it is a topic that receives frequent attention in TaxVine member feedback section. The Tax Policy team has also heard from numerous members who have detailed their specific difficulties with particular benchmarks and/or the ATO’s approach to communicating with their clients. We think it is appropriate that the Inspector General use his extensive powers of review to assess the accuracy of the benchmarks, and the appropriateness of using them in risk review and audit situations. The review will be conducted within the next year or so. We urge members to keep examples of their “war stories” which we will compile and submit to the Inspector General in due course.