The Australian Taxation Office (ATO) has launched a new initiative to support small business owners from day one, aiming to reduce common pitfalls around tax, super and registry obligations.
The campaign, titled Ready for Business, comes as the ATO highlights that “opening and running a small business is serious business.” With around 50% of businesses failing in the first three years, the ATO says confusion around tax obligations is a key contributor.
Helping businesses start strong
Over the coming months, new Australian Business Number (ABN) holders will receive a series of targeted emails. These will include guidance on business structures, GST registration, ABN obligations, and employer responsibilities.
“Our goal is to provide small businesses with guidance, tools and tips so new business owners can focus on growing their business with confidence,” said ATO Deputy Commissioner Will Day.
He added, “Small businesses are vital participants in the tax and super system. As stewards for small businesses, our role in making it easy for small business owners to get their tax and super right is more important than ever.”
The ATO acknowledges that most small businesses are trying to do the right thing, but some make honest mistakes, while others choose not to comply.
GST and side hustles in focus
GST remains a key concern. The ATO estimates nearly $8 billion is lost annually due to non-compliance, with small businesses playing a significant role in the shortfall.
“Don’t be tempted to dip into GST, PAYG withholding or super to manage your cash flow – set up separate bank accounts for these funds so you’re always prepared when it’s time to pay,” Mr Day said.
Earlier this year, the ATO contacted ride-sourcing operators and taxi drivers, reminding them of their obligations. That campaign led to more than 3,000 new GST registrations.
“Ride-sourcing operators and taxi drivers who deliberately operate outside the system will face consequences,” Mr Day warned.
The ATO is also targeting Australians with profitable side hustles more than 700,000 taxpayers are now involved in gig work or the sharing economy.
“Generally, a business involves continuous and repeated activities aimed at making a profit. Visit ato.gov.au/areyouinbusiness to learn more about whether your activities qualify as a business and understand your obligations,” Mr Day said.
Plan ahead to avoid bill shock
The ATO is encouraging new small businesses to consider entering the PAYG instalment system early. This allows them to make payments toward their expected tax bill throughout the year, instead of being caught off guard when their first tax return is due.
“We know that successful small business owners understand their tax, super and registry obligations and we are committed to helping them do so,” Mr Day said. “We also know that small businesses who engage a registered tax professional are more likely to stay on top of their tax and super obligations.”
“Through transparent communication, including the support we have available for small businesses, small business owners are better equipped to keep up with their obligations and stay on top of their tax payments. After all, small business is serious business,” he added.
“The ATO’s role is to collect the correct amount of tax so the government can deliver services for the Australian community.”
- Here’s tax time essentials, learning resources, tools and services to support small business from ATO
- Visit ato.gov.au/areyouinbusiness to learn more about whether your activities qualify as a business and understand your obligations
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