ATO engages largest private groups
Top 500 and Next 5,000 program
The ATO has set out some tips for the largest private groups that it engages through its Top 500 and Next 5,000 program.
The ATO's observation through its review of taxpayers in the Next 5,000 group is that they are more likely to adopt the correct tax position when they seek advice for significant transactions.
Not only is it important that these taxpayers identify the sale of significant assets and material transactions that have occurred during the year, but the ATO also recommends that they communicate these transactions to their tax advisors in a timely and accurate manner.
With related party transactions remaining a focus area in the context of reviews, the ATO also suggests it would be prudent for taxpayers to seek independent valuations to support sales between related parties.
For taxpayers in the Top 500 group, there is a strong emphasis on ensuring there are effective governance procedures in place. Some of the ATO's top tips for taxpayers starting to prepare income tax returns include:
> Following a lodgment and payment calendar to ensure obligations and due dates aren't missed;
> Reviewing the roles and responsibilities of parties involved in reporting obligations and preparing financial accounts;
> Identifying key dates including for signing trust resolutions and when minimum yearly repayments on Division 7A need to be made; and
> Engaging an external auditor to verify financial statements when they are used for the basis of preparing tax returns.
More information
EOFY tips for Top 500 private groups
Next 5,000 - report significant transactions right
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