Welcome and introduction
Co-chairs welcomed members to the BAS Agent Association Group (BASAAG) meeting. The group welcomed new member Jane Mitchell, ATO and thanked exiting members Darren McMaho, Dardee Pty Ltd and Kath Anderson, ATO.
It was noted action items 20231204-01, 20230323-05 and 20230323-03 will remain in progress.
Law Reform
(Links to strategic priority – Increase trust and confidence in tax, super and registry systems).
The Tax Practitioners Board (TPB) led the discussion law reform arising from the implementation of the James Review recommendations and the government response to the PwC matter.
Members provided the following feedback and observations:
- Challenges around a BAS agent’s ability to identify disqualified entities. The TPB noted that the TPB register was just one of many sources that practices/agents should check as part of good governance processes.
- The breach reporting requirements put the onus and an obligation on practitioners to report to the TPB significant breaches. Guidance around what is meant by ‘significant breach’ and ‘reasonable belief’ will be important. The TPB noted that breach reporting is intended to improve integrity and transparency. The TPB will apply a practical approach and will consult on draft guidance.
- Members discussed the emergence of agent adjacent services that don’t fall within the TPB registration and supervision ambit.
Schools Education Strategy
(Links to strategic priority – Increase trust and confidence in tax, super and registry systems).
The Australian Taxation Office (ATO) provided an overview of the Schools Education Strategy, noting that the topics of taxation and superannuation are now in the Australian Curriculum for schools. The intent of the strategy is to ensure the next generation of Australians understands and values of our tax and super systems and how to navigate these systems. Feedback was sought on opportunities to expand the program.
Members provided the following feedback and observations:
- Members congratulated the ATO on this strategy, noting its importance and suggested the learning products could be incorporated/expanded into vocational areas.
- The material would be useful for multiple purposes, including from both an employer and employee perspective and for new Australians going into business, who would benefit from simple, clear information such as this.
- It was noted that searching for ‘Tax Super and You.com’ navigates to the ato.gov.au home page. To improve awareness and access, members suggesting redirecting search outcomes to the dedicated webpage, taxsuperandyou.gov.au
Members were encouraged to share this information with their networks and to provide feedback on elements of the education material that would suit an adult audience.
Essentials to strengthen your business
(Links to strategic priority – Improve tax performance for clients of tax practitioners).
ATO walked through the new online learning platform Essentials to strengthen your small businessExternal LinkExternal Link. The website is a free resource, designed to be flexible for online learning with more than 20 courses now available, covering a range of aspects of the lifecycle of a small business. The online learning platform has recently been launched and has received positive feedback.
The ATO noted that future online courses are planned and sought feedback from members on how to promote and improve the program.
Future online courses will include:
- Concessions
- Personal services income
- Losses
- Depreciation
- Reporting payments made to contractors
- Capital gains tax
- Fringe benefits tax – minor exempt benefits.
Future masterclasses will include:
- Claiming small business tax deductions
- Cash flow for small business success – strategies to improve your cash flow
- Goods and services tax (GST)
- Using your business money and assets
- Record keeping
- Starting a small business – setting up your small business.
Members provided the following feedback and observations:
- Members congratulated the ATO on this program and noted value in getting an awareness of this program to people before they apply for an Australian Business Number.
- It was suggested that future updates include an explanation of the difference between tax and BAS agents.
- Suggestions for future online courses/topics were mentioned including, superannuation, personal liability, basics of digital safety, generative AI (how to and how not to use AI), and tax file numbers (their importance and how to secure them).
- Feedback was provided on navigation options and the wording in the calendar/due date section of the program regarding superannuation guarantee payment due dates.
Members were encouraged to promote this program via their networks and to provide feedback on the program to the secretariat.
Private companies and Division 7A
(Links to strategic priority – Improve tax performance for clients of tax practitioners).
ATO led the discussion on its Division 7A program which focuses on raising awareness and improving knowledge of the rules concerning the taxation of payments, benefits and loans received by shareholders and their associates from private companies. We noted that whilst BAS agents may not generally provide Division 7A advice, their role in relation to private company clients puts them in a position to observe and gain insights about their clients’ level of understanding and compliance.
Members provided the following feedback and observations:
- The interaction of the TASA law reforms, particularly the new breach reporting requirements was discussed.
- An observation that Division 7A issues often emerge when a client moves from being a sole trader to a business/corporate structure.
- Simple fact sheets and education materials with case studies that highlight some of the negative outcomes of Division 7A loans would assist practitioners.
What’s new in Online services for agents
(Links to strategic priority – Safeguard the security of the tax, super and registry systems).
The ATO provided an update on the recent changes to Online services for agents including:
- changes to transfer requests
- lifting the maximum amounts from $100,000 to $200,000 for payment plans
- enhancements to single touch payroll reporting
- changes to processing of known amounts with non-lodged activity statements
- flexible lodgment arrangements where there has been an adverse event.
Upcoming changes will include:
- expanding the ability to lodge bulk correspondence preferences for up to 50 clients, the limit is currently 25 clients
- restricting the number of times a BAS can be amended, once the limit is reached, agents will be directed to contact the ATO
- AUSkey credentials will be removed from Access Manager
- enhanced in-system guidance in Online services for agents when an agent is going to link at the activity statement account or potentially remove another agent’s access (client-to-agent linking).
Members provided the following feedback and observations:
- Regarding the upcoming change to restrict the number of times a BAS can be revised/amended, members asked what process should be followed if they legitimately need to revise/amend a BAS and the limit to online amendments has been reached.
- The Online services for agents enhanced in-system guidance that will help reduce instances of BAS agents being delinked by tax agents is welcomed.
- It would be beneficial to have audit trail visibility within Online services for agents to easily identify which agent made changes to the activity statement.
Client-to-agent linking and verification
(Links to strategic priority – Safeguard the security of the tax, super and registry systems).
ATO led the client-to-agent linking discussion, including information on the planned delivery of new in-system guidance in Online services for agents to help reduce inadvertent de-linking of BAS agents and gave an update on the Client-to-Agent Linking working group.
The ATO understands this is an important matter for agents and their new clients and wants to provide visibility of our next steps. The purpose of Client-to-Agent Linking is to address fraud and provide protection when bad actors take over the identities of good agents and do bad things to their clients and the clients of other agents. To date, nearly 150,000 clients have completed client-to-agent linking either via online nomination or via ATO assistance channels through practice mail and phone. Since the introduction of the changes, there have been no instances of fraudulent takeover of agents’ clients by bad actors.
The ATO acknowledged the strong advocacy of the tax and BAS professional associations and working group members on behalf of the tax profession. We will continue to engage with tax and BAS associations and look for opportunities to enhance the process and further capitalise on any changes to the technology that will improve the process for agents and clients.
Members provided the following feedback and observations:
- For several clients, the process has proven too difficult, and they have chosen to stay with their existing agent.
- A fact sheet with entity-type personas (for example partnerships, trusts etc.) would be useful.
- The upcoming Online services for agents enhanced in-system guidance to help reduce instances of BAS agents being delinked by tax agents is welcomed but we would like to see post deployment statistics.
Improving payment performance
(Links to strategic priority – Protect the high levels of engagement and integrity in the tax, super and registry systems).
ATO led the discussion on improving payment performance measures, including planned communications to accompany the April activity statement due dates. We will be taking a firmer stance on non-payment of activity statement debts relating to GST, super and pay as you go withholding, with general interest charge (GIC) remissions being reserved for genuine exceptional cases.
From late January 2024, we commenced referring selected debts to an external debt collection agency (ECA). The ECA will focus on providing support to taxpayers to pay their debt in full, or where they are unable to pay in full, to assist with establishing a tailored payment plan. This allows us to re-direct internal resources to more complex and priority work that signals the ATO’s firmer approach to the broader community.
If you don’t pay information is available and was provided in recent Tax professionals newsletter on how to verify the contact made by the ECA and what to do if unsure.
The ATO thanked members who have been involved in the Lodge and Pay Working Group, noting that this group will be paused for a period whilst the ATO works through feedback and action items.
Feedback was sought on the planned communications, including how we can reinforce our messaging regarding the firmer stance on GIC remissions.
Members provided the following feedback and observations:
- Consistency in the ATO’s approaches, treatment and decisions are important.
- Discussed outcomes for clients who opt to pay earlier, providing example of a quarterly GST client choosing to pay monthly. If they are late on their monthly payment, they will be charged GIC. If this isn’t remitted, the client may opt to revert to quarterly payments.
- Members discussed payment only deferrals but acknowledged these deferrals impact more than just the client, it has overreaching impacts to whole of government revenue collections.
Environmental scan
The following issues were discussed:
- Small Business Superannuation Clearing House
- Payment concerns were raised, including that direct credit payment options are no longer shown on the front page/payment section and are instead under ‘other payment’ options and that BPAY is not available for batch payments through software
- Proof of identity requirements for new clients of BAS agents
- Potential items for the group’s Forward Work Program were identified, including sessions on debt/action letters, superannuation related matters and Taxable payments annual report.
Other business
The group endorsed the updated BASAAG Charter and membership refresh has been scheduled for 2024. The following tabled papers were noted:
- Small Business Superannuation Clearing House and self-managed super funds bank account details validation.
- Stopping the use of hyperlinks in unsolicited outbound SMS to clients.