Tax Penalty Amnesty Scheme

An announcement that received little publicity from the 2023/24 Federal Budget in May was the lodgement amnesty program for small business.

The aim of this is to allow small business owners to bring their outstanding tax obligations up to date without the fear of “failure to lodge penalties” being applied.

Small business tax payers will now have between the 1st of June and the 31st of December this calendar year to lodge overdue and outstanding returns related to the following taxes and timeframes:

  • Income tax returns for the 2018–19 and 2019–20 income years

  • Business activity statements (quarterly) for the December quarter 2019 to the December quarter 2021

  • FBT returns for the 2019–20 and 2020–21 FBT years

In order to be classified as a small business for the purpose of the amnesty the following rule applies;

The small business must be an entity with an aggregated turnover of less than $10 million at the time the original lodgement was due.

To highlight the benefit of undertaking lodgement through the amnesty period, the penalties that would apply are as follows:

The Failure to Lodge penalty range from the table immediately below for smaller liabilities and is applied at the rate of one penalty unit for each period of 28 days (or part thereof) that the obligation is overdue, up to a maximum of five penalty units. 

Additionally, for liabilities related to businesses classified as either

  • a medium withholder for PAYG withholding purposes (withholds $25,001 to $1 million per year), or

  • has assessable income or current GST turnover of more than $1 million and less than $20 million (capped at $10 million for the purpose of the amnesty).

If you are a small business owner and you are currently behind with their business income tax, GST, PAYG withholding or FBT lodgements, please reach out to one of the accountants at Salt to see if the amnesty will apply and how we can assist to get you fully compliant with the ATO.

Jenni Anderson