The Building Industry and Your Tax Debt

The building and construction industry has really taken a hit with these recent lockdowns.

Here at Tax Assure, we get it.

At the moment a number of factors are limiting your business’s potential; you haven’t been able to trade normally, access to worksites is restricted, there’s limited materials available, plus access to skilled labour is difficult, money is drying up fast, and there are too many unknowns at the moment.

What’s been the price tag so far?

In July, the ABC reported an estimate of a $1billion-per-week price tag on the Sydney lockdown. Estimates have also put the cost of Melbourne's lockdown around $700 million a week, which would also rise dramatically if it had to follow Sydney's lead and stop building work.

That was July… one can only imagine what the cost to our Australian economy will be at the end of these lockdowns.

And then there’s your business and the ATO. It’s almost impossible to stay on top of your statutory obligations when you’re faced with so many obstacles in your way.

What’s the ATO doing when it comes to your Tax Debt?

Recently, we have seen an uplift on collection and enforcement activity within the ATO’s firmer action team.

Accountants Daily has quoted the ATO stating, “we have not halted our debt and lodgement activities,” …. “The ATO’s decision not to pause all debt collection activities comes after it failed to hit its compliance revenue target by $1.3 billion last year, with collectable debt rising by 28 per cent to $34.1 billion.”

 

However, that said, the ATO has seen the importance of helping where it can through this pandemic and is willing to work with business.  This assistance however is only for businesses that engage with the ATO and ensure they remain in a position of compliance.  Even in these COVID times, the ATO insists on engagement.

Unfortunately, your debt won’t just disappear if you continue to ignore it.  It will still be there on the other side of this.

Top Tips

Our 3 major top tips for businesses with any tax debt at the moment are:

  • Don’t ignore your debt;
  • Engagement with the ATO is key; and
  • There are a variety of solutions and help available other than paying the debt in full or ignoring it.

The ATO have specifically stated engagement is the key and without this, the ATO will have no other alternative than to start legal recovery action.

The good news is engagement doesn’t mean the debt must be paid in full immediately.

With the right help, there are a variety of solutions available.  These including long term payment plans that match your current cash flow position and the possibility of reducing your overall debt with the remission of interest and penalties that may have incurred on your accounts.

If you continue to ignore the debt, this will not only severely affect your position of compliance with the ATO, and your future ongoing position with the ATO, but there are additional ramifications you may not be aware of.

Do you have more than $100,000 in Tax Debt?

The ATO can report a business with over $100,000 owing in Tax debt to credit reporting agencies.  This will immediately affect a business’s credit rating. The ATO has begun sending warning letters of their intent to disclose tax debt information to credit reporting bureaus if you do not make an effort to manage your debts within 28 days of receiving this warning letter.

This is in line with the ATO’s resumption of its collections work. Even though on the surface it may seem as if the ATO is quiet, they are still very much actively moving forward with their collections plan and work.

If a business is actively working with the ATO to manage their tax debt, including entering into a payment plan and engagement with the ATO, their tax debt will not be reported to credit reporting bureaus.

Ignoring the ATO can mean that it will be harder for you in many ways. Have a quick think:

  • Do you want to obtain a credit card in the future?
  • Do you want to obtain a loan from a bank, or finance provider in the future?
  • Maybe you want to buy a house but can’t pay cash? or
  • Will you need to perhaps rent?

This is one example of why it is vital that you continue to engage with the ATO during this difficult time.

 

The Tax Debt landscape has changed, and is continuing to change during this pandemic… these are for sure very difficult times. Here at Tax Assure, our aim is to support each and every business owner who needs assistance getting back on track, or have any concern, during these difficult times.

For more information or if you want to chat through any difficulties you are currently experiencing please call us: we are here to help.

 

Olga Koskie | Principal

T: 1300 952 295 | M: 0418 260 027

olga.koskie@taxassure.com.au

www.taxassure.com.au


What is required for a tool box talk?

Toolbox Talks

What is a Toolbox Talk?

A Toolbox Talk or Pre-Start is an informal health and safety meeting that focuses on topics related to the workplace, job, or project. These informal meetings are usually conducted at the start of a shift or after an incident has occurred. Examples of topics that can be discussed are hazards, safe work practices, any new plant or equipment, changes to the worksite, and how the organisation is controlling its risks. Topics can be used to pass on important safety information but also work as a prompt for employees to discuss safety and identify potential hazards.

The key to an effective Toolbox Talk is to keep it short and straight to the point. It is usually a two-way discussion and is a good chance to engage the team.

What is required for a Toolbox Talk?

Have a Toolbox Talk template ready to go. These templates usually have:

  • Name of person conducting the Toolbox Talk
  • Date
  • Work area/Name of worksite
  • Topic
  • Summary of items discussed
  • Attendance field / a table where individuals who have attended the meeting, can write their name, company represented, and signature.

Make sure you have a team or group that you will be conducting the Toolbox Talk with. An example of what to ask yourself is, who will be affected by the:

  • Hazard/risk
  • New plant
  • Change of condition to the site
  • New procedure

These questions (but not limited to) can help you determine who to include in the Toolbox Talk.

Who should run the Toolbox Talk meeting

Anyone can run the Toolbox Talk although it’s common that Supervisors, Team Leaders, OHS Officers, or HSRs run it. The key aspect is that the person running it has a clear idea of what the discussion topic is and is able to communicate it effectively and initiate a discussion between the team.

Some tips on a successful Toolbox Talk

Have some key points ready to discuss for the Toolbox Talk and record it into the Toolbox Talk template beforehand. Usually, before you start your Toolbox Talk, you already have an idea of what you want to discuss.

Keep Toolbox Talks short, simple and straight to the point. These meetings are informal and are designed to be 5-10 minutes long.

Toolbox Talks or pre-starts are commonly conducted at the start of the shift where the team discusses what hazards/risks may be expected during the shift (common topics listed in the next section). They are also conducted post-incident, to discuss any Lessons Learned.

Engage the team in the discussion by asking them for their thoughts on the situation or asking them for their feedback. Some team members may provide feedback based on past experience, which can prove to be valuable information.

 

By Hazel Smirlis - Compliance Lab

www.compliancelab.com.au