New year, new rules: ATO’s 2025 focus areas for small businesses
The Australian Taxation Office has kicked off 2025 by announcing its major areas of interest when it comes to small businesses. It has also highlighted a tougher stance when it comes to super guarantee (SG) compliance and GST fraud. Here’s a roundup of the latest tax news.
The regulator has announced its key small business tax issues for this financial year.
The three main areas the ATO is focusing on are:
- deductions and concessions (non-commercial losses and small business CGT concessions)
- incorrect use of business income (business money and assets used for personal use of benefit), and
- businesses operating outside the system (GST registration and income for taxi, limousine and ride-sourcing services).
The ATO intends to review and publish quarterly focus themes to help small businesses work on fixing issues in these areas.
GST fraud warning
The ATO-led Serious Financial Crime Taskforce is warning businesses against trying to cheat the tax and super system by committing GST fraud, saying it is on the lookout for potentially fraudulent activities.i
New information shared between government agencies shows some businesses are using complex financial arrangements to disguise transactions with the aim of obtaining larger GST refunds.
The arrangements include false invoicing between related entities, deliberately misaligning GST accounting methods across a group, duplicating GST credit claims, and claiming for fake purchases.
Tax penalties increase
The cost of penalty units imposed by the ATO if you fail to meet your tax obligations has increased again, rising from $313 to $330 per penalty unit.ii
The new rate applies to infringements occurring on or after 7 November 2024. For example, the penalty for failing to keep or retain tax records as required is 20 penalty units (20 units x $330 = $6,600).
Other penalties apply to missed and late SG payments, individual and corporate SMSF trustees and GST when buying or selling new residential premises.
SG compliance under scrutiny
With more timely data now available from Single Touch Payroll reporting, SG reporting and payments have become a priority area for the ATO. It is reminding employers to keep good records, report accurately and pay their obligations on time.
As part of its firmer response towards non-payment of SG contributions, the ATO issued 8,710 director penalty notices relating to 6,500 companies during 2023-24.iii
Although the regulator found 92.4 per cent of employers paid their SG obligations without intervention, it still collected and paid $932 million in SG entitlements into the super accounts of 797,000 employees.
GST and fuel tax credit time limits
The ATO is encouraging businesses eligible for GST and fuel tax credits to claim their credits within four years of the due date of the earliest Business Activity Statement (BAS) where a claim could have been made.
Once the time limit passes, you are no longer eligible to claim the credits. Lodging an amendment to an original assessment or requesting a private ruling are not considered as claiming.
Old credits can be claimed in your next BAS (provided it is within the eligibility period), by lodging a revised BAS for the original period via ATO Online Services, or by lodging a valid objection during the time limit to preserve your entitlement to the credits.
Change to myGovID
The Australian Government’s digital ID app myGovID, used to access government services, has been renamed myID.
The app provides secure access to government services using your existing login details (including email address), with the identity strength remaining the same. Existing app users should find the app automatically updated on their smart device, or it can be manually updated from the Apple app store or Google Play.
The ATO is warning users that scammers are seeking to take advantage of the name change. Any message or email asking you to set up a new myID or reconfirm your details is a scam.
i Taskforce issues GST fraud warning to dishonest businesses | Australian Taxation Office
ii Penalty units | Australian Taxation Office
iii Our SG compliance results are here | Australian Taxation Office
