If you’re a growing business you could be included in our Medium and Emerging private groups tax performance program. This will affect how you manage your tax and other obligations.
Over the next month, we’ll be contacting selected businesses and entities who now meet our criteria for Medium and Emerging private groups, such as:
- private groups linked to Australian resident individuals who, together with their associates, control wealth between $5 million and $50 million
- businesses with an annual turnover of more than $10 million that are not public or foreign owned and are not linked to a high wealth private group.
From speaking with medium and emerging private groups, we’ve identified 4 key areas where we see errors being made. These are areas you should focus on to avoid the kinds of mistakes that can lead to penalties.
Trusts
If you've got a trust or trusts in your business structure, revisit your governance and learn which trust activities attract our attention.
Business loans and Division 7A
If you've got Division 7A arrangements in place, complete annual checks to make sure you’re compliant. Look out for:
- incorrect accounting
- loans that don’t comply with Division 7A agreements
- incorrect benchmark interest rates
- reborrowing from a private company to make repayments on Division 7A loans.
Capital gains tax (CGT) concessions
If you’re restructuring and looking to access CGT concessions, check your eligibility each year before you apply for those concessions.
Omitted or incorrect reporting of income
If you haven’t reported all of your income or if you’ve made a mistake, you should correct the mistake or amend your return.
If we contact your business, you can contact your registered tax professional to discuss your obligations and check that you’re not making these errors in your records.