Newsletter
October 2010 Newsletter
Direct Debit for GIC free Payment Deal
In June 2009, the Commissioner announced new measures to help small businesses with annual turnovers of less than $2m (ie ‘micro businesses’) that were struggling to manage their tax debts. At that time, Mr D’Ascenzo warned that, where necessary, the Tax Office would take action to collect tax debts in relation to taxpayers who have not worked with the Tax Office to meet their payment obligations or continually default on agreed arrangements.
The concessionary measures included a 12-month general interest charge (GIC) free payment arrangement (until 30 June 2010) and a deferment for up to 2 months of the payment date for activity statements. These measures have been extended until 30 June 2011.
While the concessions remain available to businesses with a turnover under $2m, the Tax Office says it now expects businesses entering GIC-free payment arrangements to pay by direct debit.
According to the Tax Office, payment arrangements that businesses enter into with it from 1 July 2010 to 30 June 2011 will be GIC-free for the period they are maintained, up to a maximum of 12 months. This may also apply to payment arrangements businesses entered into with the Tax Office before 1 July 2010 that were later renegotiated.
TIP: This concessionary measure does not extend to activity statement lodgment due dates. In other words, taxpayers must still lodge their activity statements on time, or face potential penalties.