Tax office boss Chris Jordan has floated the possibility that small business owners might not need to fill out their own Business Activity Statements (BAS) in the future, saying a range of “exciting stuff” is on the horizon that could streamline the relationship between companies and the ATO.
Speaking on an Institute of Public Administration Australia (IPAA) podcast earlier this week, Jordan said the ATO could take the administrative strain off the shoulders of small business owners.
“We can use natural systems like bank accounts, let’s say. Cash is becoming increasingly less, and some places are now saying no cash, rather than only cash,” Jordan said.
“If we could say: ‘Okay, you let your bank know to give us approval, and we draw down from your bank, and that’s all the deposits, that’s your income, and all the outgoings, as long as you don’t take private stuff out of there, are your deductions.’
“With all these automatic write-offs up to $20,000, $50,000, most small businesses do not spend more than that on any one thing. The most thing they might spend on is a computer or something like that.
“We could drawdown that each quarter, do your BAS for you, and at the end of the year, you might still want to go to your accountant or tax agent say: ‘Okay, well, this is what the tax office has done for three quarters. Can you make sure that the overall is to my advantage?'”
Jordan said the approach would be all about using “natural systems” already relied on by small business owners and using the ATO’s newfound analytical prowess to streamline small business obligations.
“If we think you sit in the right range for your industry and number of employees and area of operation, we have got very sophisticated benchmarks now, very sophisticated analytics,” he said.
“If you sit within a range, we might go, we will just take your bank account, and that’s it. That’s your BAS, that’s your tax return, that’s everything.
“We will tell you just give us five grand every quarter, or 50 grand, whatever the tax is, and that’s it.
“We will send you a notice, you send us the money, and all your obligations could be done.
“That is the exciting stuff that is on the horizon,” Jordan continued.
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