The Federal Government has announced that it is providing tax relief measures for small businesses.
During the federal budget announcement, the Australian Tax Office (ATO) made a pledge to scrap failure-to-lodge penalties for some small businesses with an annual turnover of less than $10 million.
The tax relief measure comes as new data from ASIC shows 6144 Australian businesses have already been placed into administration this financial year, a 25 per cent increase already on last year despite the year not being over yet.
“This is great news for Australian SMEs that have accrued a tax debt during the COVID years,” Angus Sedgwick, CEO of alternative finance solutions company OptiPay, said. “At the request of the Coalition government, the ATO allowed Australian businesses to not pay BAS and PAYG during that time which resulted in $30billion of unpaid taxes.
“This amnesty will allow businesses that are struggling with rising interest rates and restricted access to capital in a high inflationary environment to implement a payment plan for accrued taxes,'” Sedgwick added.
Sedgwick said that it is essential business owners engage with the ATO rather than take a ‘head in the sand’ approach hoping they won’t come knocking.
“It’s been a tough time for Australian businesses with inflation, rising costs, tax collection and traditional bank finance drying up for many,” Sedgwick pointed out. “We’ve had a huge spike in broker-driven enquiries as access to capital becomes more difficult.”
“Cashflow is everything for a business and in the current economic times it’s even more important that is maintained,” he concluded.
