Coronavirus (COVID-19) | ATO Support
To assist businesses experiencing financial difficulty as a result of COVID-19 the ATO is implementing a series of relief options.
These relief options will not be automatically applied, contact will need to be made with the ATO to discuss them.
If you or your business are experiencing financial difficulties because of COVID-19, phone the ATO Emergency Support Infoline on 1800 806 218.
Working from home deductions
The Australian Taxation Office (ATO) is announcing special arrangements this year due to COVID-19 to make it easier for people to claim deductions for working from home.
The new arrangement will allow people to claim a rate of 80 cents per hour for all their running expenses, rather than needing to calculate costs for specific running expenses.
Multiple people living in the same house can claim this new rate. For example, a couple living together could each individually claim the 80 cents per hour rate.
The requirement to have a dedicated work from home area has also been removed.
Assistant Commissioner Karen Foat said the new shortcut method will make it easier for those who are working from home for the first time.
For more information on these special working from home deduction arrangements, please click here.
Contact the ATOs Large Service Team for support and advice about tax administration or technical issues affecting large business.
If you or your business has been impacted by COVID-19, the ATO can work with you to defer some payments and vary instalments you have due, such as income tax, activity statement (including PAYG instalments), FBT and excise payments to 12 September 2020.
Monthly GST credits
Businesses on a quarterly reporting cycle may elect to change their GST reporting and payment to monthly, to get quicker access to GST refunds you are entitled to. You can only change from the start of a quarter, so a change now will take effect from 1 April 2020.
Changing your GST reporting cycle to monthly doesn’t mean you have to change your PAYG withholding reporting cycle. You can manage this by specifying the roles you are changing.
Once you choose to report and pay GST monthly, you must keep reporting monthly for 12 months before you can elect to revert to quarterly reporting.
However, if your GST turnover is more than $20 million you must pay and report monthly.
If you’re registered for fuel tax credits, and change your GST reporting from quarterly to monthly, you will also need to claim your fuel tax credits monthly.
You can change your GST reporting cycle through your tax or BAS agent, in the business portal, or by phoning the ATO on 13 72 26.
Pay as you go instalments
If you are a quarterly pay as you go (PAYG) instalments payer you can vary your PAYG instalments on your activity statement for the March 2020 quarter. You can do this by lodging a revised activity statement before your instalment is due and before you lodge your tax return for the year. Businesses that vary their PAYG instalment rate or amount can also claim a refund for any instalments made for the September 2019 and December 2019 quarters.
If you are a monthly payer and have a base assessment instalment income of $500 million or less, and want to vary your instalment rate and claim a refund on previous instalments paid, you will need to phone the ATO on 13 72 26 to discuss.
If you realise you’ve made a mistake working out your PAYG instalment, you can correct it by lodging a revised activity statement or varying a subsequent instalment.
Remitting interest and penalties
Where your business is affected by COVID-19, the ATO will consider remitting interest and penalties applied to tax liabilities incurred after 23 January 2020.
Low interest payment plans
If your business has been affected by COVID-19 and you need help to pay your existing and ongoing tax liabilities, contact us to discuss entering a low interest payment plan.
Super guarantee amnesty
Many businesses are suffering as a result of the global pandemic and are finding it difficult to keep up with their financial obligations including payment of employees’ superannuation. Some business may be reluctant to disclose to the Australian Taxation Office (“ATO”) their outstanding superannuation obligations.
On 6 March 2020, the government introduced a Superannuation Guarantee Amnesty (“the Amnesty”) which will allow employers to disclose and pay previously unpaid superannuation guarantee charges (“SGC”) including nominal interest (10%), without incurring the administration component ($20 per employee per quarter) or Part 7 penalty (up to 200% of the SGC).
The Amnesty applies to any superannuation guarantee shortfalls for quarters between 1 July 1992 and 31 March 2018.
If businesses wish to apply for the Amnesty, they must apply by 11:59pm on 7 September 2020.
Fortunately, the ATO has stated that they are willing to work with businesses who have been affected by COVID-19 by making special and flexible arrangements. These arrangements include:
- Working with businesses to create flexible payment terms and amounts which the ATO will adjust if circumstances change; and
- Potentially allowing businesses to extend the payment plan to beyond 7 September 2020 (the end of the amnesty period). However, only payments made by 7 September 2020 will be deductible.
Businesses who are still unable to maintain payments under these new payment arrangements, the ATO are required by law to disqualify them from the Amnesty and remove the Amnesty benefit. However, the ATO have advised that:
- the disqualification will only apply to any unpaid quarters;
- the ATO will advise which quarters are unpaid and for these quarters the ATO will re-apply the administration component of $20 per employee included in the disqualified quarter; and
- the ATO will also take the employer’s circumstances into account when deciding whether a Part 7 penalty should be applied the employer’s disclosure. This review may result in the Part 7 penalty being reduced to nil.
The ATO have advised that some employers who will apply for the Amnesty will potentially receive a refund. In particular:
- for employers who are eligible and lodged a SGC statement between 24 May 2018 and 6 March 2020, the ATO is in the process of amending their returns as quickly as possible so that any refunds can be paid; and
- if employers made payments of SGC or contributions to employee super funds in 2017-18 or 2018-19 that are eligible for income tax deductions, the employer should include this deduction in their tax return for the relevant year. Once the ATO has amended the employer’s return, the ATO will pay any refund due as soon as possible (generally within 14 days).
In addition to all of this, the ATO has acknowledged the difficult times the community has been experiencing recently with COVID-19 and the 2019–20 bushfires, however, the law does not allow the ATO to vary the due date for lodgement of an amnesty application.
The ATO will set up a temporary shopfront in Cairns with dedicated staff specialising in assisting small business.
In addition, they will consider ways to enhance our presence in other regions, making it easier for people to apply for relief.