Tax update January 2025 | Oracle Accounting & Tax Advisers

In our January 2025 tax update edition, we explore the new PAYG adjustment factor, Fraudulent claims for GST refunds continue to be a major focus for the ATO, with several new pilot programs announced to help small businesses with GST reporting.

Here’s a roundup of the latest tax news:

New PAYG adjustment factor

Pay As You Go (PAYG) instalments – whether you pay quarterly or twice yearly - have been increased to 6% for 2024-2025 to reflect the latest GDP increase.

The change in the adjustment factor does not affect taxpayers who work out their own instalments or pay annually.

PAYG instalment amounts can be varied through the ATO’s Online services for business if you believe your current instalment amount will be more or less than your expected tax liability for the year.

Pilot programs to protect the GST system

The ATO will be running a number of pilot programs during 2025 that aim to improve the digital tax experience for small businesses.

The pilot programs will encourage more frequent payment and reporting by small businesses and try to reduce complexity by embedding the tax rules and logic into small business software.

The ATO also hopes to empower small businesses by providing more information to help them get their GST right from the start, providing them with more time to focus on their business, rather than their tax obligations.

Community tip-offs increasing 

The community appears increasingly willing to report tax cheats. The ATO received more than 47,000 tip-offs during 2023-24, with around 90% deemed suitable for further investigation.

Building and construction, cafes and restaurants, and hairdressing and beauty services topped the list of industries reported.

Common tip-offs include taxpayers not declaring income, demanding cash from customers, paying workers in cash to avoid paying tax and super, not reporting sales, and where someone’s lifestyle does not appear to match their income.

Obligations for festive season employees 

Hiring new employees to help out during the festive season brings with it the same tax and super obligations as regular employees.

The ATO is reminding employers to ensure they withhold the right amount of tax from any payments made and also to pay all eligible employees’ super funds the correct amount of Super Guarantee to avoid paying the Super Guarantee Charge.

Employers without an approved exemption, deferral or concession must lodge the necessary information for new employees through the Single Touch Payroll system from their first payday.

GST fraudster imprisoned

Stamping out GST fraud continues to be a priority for the ATO, with a Victorian woman sentenced to four years imprisonment after claiming nearly $600,000 in GST refunds from 27 fraudulent business activity statements.

She is also being pursued for the amount she fraudulently obtained by submitting multiple false claims for a fake cleaning business.

The case is part of the ongoing ATO-led Operation Protego, which was set up in response to numerous cases of attempted GST fraud. So far 104 people have been arrested and 59 convicted.

Eligibility for small business litigation funding

If you have a dispute with the ATO being heard by the Administrative Review Tribunal, you may be eligible for litigation funding to cover “reasonable” legal expenses.

To qualify, you must be a small business (sole trader, partnership, company or trust) operating a business for all or part of the relevant income year and have a turnover under $10 million.

Funding is available only if the matter does not involve a tax avoidance scheme, fraud or cash economy issues. You must not have a history of failing to lodge tax returns.

Updating your ABN details

The ATO is reminding taxpayers holding an Australian Business Number (ABN) that they need to regularly ensure their current contact details are correct so they don’t miss out on important help, information, or support like financial grants.

Check both your physical business address and postal address are listed on the Australian Business Register, together with your authorised contacts, contact details and business activities.

We’d be happy to provide further information or clarification about any of the new tax measures or to provide advice if they affect you. Get in contact with Oracle Accounting & Tax Advisers today!

Important information – Oracle Advisory Group makes no representation or warranties as to the accuracy or completeness of any statement in it including, without limitation, any forecasts. The information in this document is general information only and is not based on the objectives, financial situation or needs of any particular investor. An investor should, before making any investment decisions, consider the appropriateness of the information in this document, and seek their own professional advice. Past performance is not a reliable indicator of future performance. The information provided in the document is current as the time of publication.