Proposed changes to ATO IT systems

As the winds of change continue to blow through the ATO, the
Institute is closely monitoring two new ATO initiatives. The two initiatives
are its technology transformation project discussed at the decent Drivers for Change
Conference and Project DO IT.

Drivers for change –
new business tax return and reporting requirements

The first project is
particularly important for any practitioner who lodges tax returns for
businesses. It involves the end of the current electronic lodgement service
(ELS) arrangements and will require practitioners to ensure that their clients’
charts of accounts comply with a standard format. The ATO explained the
proposed changes at its National Tax Practitioner Drivers for Change Conference
held on 17-18 June 2014 in Sydney, which our tax policy team attended. The
conference focused on what might change in the next decade for tax
practitioners, having regard to rapid technological advances and globalisation.
A key initiative the ATO discussed at the conference was the transformation
from ELS to standard business report (SBR).

The SBR concept has been around for some time. It is
designed to provide a single system for businesses to input information for use
government-wide, but my impression is that to date businesses have been slow to
adopt the changes required to implement SBR. The government participants
include the ATO, APRA, ASIC, the Australian Treasury, the Australian Bureau of
Statistics and the eight state and territory revenue offices. Under SBR,
Australian businesses are able to use SBR-enabled software to prepare and lodge
key government forms directly from their software to the agencies participating
in the SBR program. Businesses use a single secure log on, AUSkey, when sending
reports to agencies via SBR (see further
One of the beneficial outcomes of SBR is that it will allow
the ATO to prepopulate business tax returns.
The critical date for practitioners who use ELS is 1 July
2016, after which no new forms will be available through ELS. The ELS system
will be phased out altogether shortly afterwards. The ATO called on tax practitioners
to begin liaising with their software developers as soon as possible to exercise
some influence over the software products that will be available to them to process
lodgements through SBR.
Unlike ELS, SBR is an internet-based system. A key emerging
issue with respect to SBR is — what services will be offered to tax agents
through the tax agent portal and what will be offered through SBR? We receive a
great deal of member feedback regarding the portal. It is clear that our members
have a love/hate relationship with the portal as it is both indispensable and
at times unreliable. Only time will tell if SBR and the portal can coexist harmoniously
and allow our practices to operate more efficiently. Past experience tells me
that any new project requiring the ATO to change its IT systems can cause major disruptions to lodgements.
The potential for disruption is still greater in this case
because the project requires practitioners and their clients to make IT system
changes that are compatible with the ATO’s systems. Be assured The Tax Institute
will be at the forefront to represent our members’ interests as this transition
gathers momentum.

Michael Flynn CTA is President of the National Council at The Tax Institute.

The Tax Institute is Australia's leading professional association in tax. Its 13,000 members include tax agents, accountants and lawyers as well as tax practitioners in corporations, government and academia.


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