New small business owners to get compliance support by the ATO
GST Registration
Small businesses that don’t completely understand their GST obligations may get caught out when it is time to pay. A small business is required to register for GST if it carries on an enterprise and its GST turnover exceeds $75,000 per annum. For non-profit organisations, the registration threshold is $150,000 per year. If a business's GST turnover is below these thresholds, registration is voluntary. However, if a business provides taxi or limousine travel, it must register for GST regardless of its turnover.
PAYG Installments
The ATO is also encouraging new small businesses to plan ahead to avoid a large tax bill when they lodge their first tax return. To prevent this, new small business owners can voluntarily enter and prepay their estimated tax liability through PAYG instalments as soon as they start their business.
PAYG withholding and superannuation contributions
The ATO has encouraged small businesses to set aside GST, as well as PAYG withholding and super if they have employer obligations and avoid using them to manage business cash flows.
SIDE HUSTLES
New and existing small businesses should consider if any side hustle activities they carry out qualify as a business and understand their obligations in relation to GST, PAYG and superannuation contributions.
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ATO Deputy Commissioner has noted that small businesses that understand their tax, super and registry obligations and engage a registered tax professional are likely to stay on top of their tax and super obligations.
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