Small companies in Australia are now required to join the federal government’s single-touch payroll scheme but at the same time will also lose a A$100 (US$77) tax offset intended to encourage investment in business reporting software.
The offset was first announced in the government’s 2015/16 mid-year economic and fiscal outlook (MYEFO) papers, which the aim of providing financial support to firms generating less than A$2 million (US$1.53 million). It came into force this July to incentivise the purchase of reporting software in the 2017/18 financial year, but has now been ditched due to lack of take-up, saving the government about A$35 million (US$26.83 million).
During a pilot project for single-touch payroll, more than half of the participants had indicated that the A$100 offset would make no difference to their decision over whether to buy the software or not.
But the government’s 2017/18 MYEFO papers have also revealed that companies with fewer than 20 employees will now be obliged to adopt the single-touch payroll scheme. In the past, compliance had been deemed to be voluntary.
The Australian Taxation Office (ATO) has been given A$63.9 million (US$48.99 million) to help broaden the initiative out and expects to reap an extra A$70.8 million (US$54.28) as a result. Part of its new funding will go towards helping Australian Prudential Regulation Authority-regulated super funds move to undertaking event-based reporting of superannuation (pensions) guarantee contributions to the ATO.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
Small companies in Australia are now required to join the federal government’s single-touch payroll scheme but at the same time will also lose a A$100 (US$77) tax offset intended to encourage investment in business reporting software.
The offset was first announced in the government’s 2015/16 mid-year economic and fiscal outlook (MYEFO) papers, which the aim of providing financial support to firms generating less than A$2 million (US$1.53 million). It came into force this July to incentivise the purchase of reporting software in the 2017/18 financial year, but has now been ditched due to lack of take-up, saving the government about A$35 million (US$26.83 million).
During a pilot project for single-touch payroll, more than half of the participants had indicated that the A$100 offset would make no difference to their decision over whether to buy the software or not.
But the government’s 2017/18 MYEFO papers have also revealed that companies with fewer than 20 employees will now be obliged to adopt the single-touch payroll scheme. In the past, compliance had been deemed to be voluntary.
The Australian Taxation Office (ATO) has been given A$63.9 million (US$48.99 million) to help broaden the initiative out and expects to reap an extra A$70.8 million (US$54.28) as a result. Part of its new funding will go towards helping Australian Prudential Regulation Authority-regulated super funds move to undertaking event-based reporting of superannuation (pensions) guarantee contributions to the ATO.
Emma Woollacott is a freelance business journalist. Her work has appeared in a wide range of publications, including the Guardian, the Times, Forbes and the BBC.
