Don’t let your business be part of the $11 billion in unpaid taxes

Don't let your business be part of the $11 billion in unpaid taxes

An estimated $11 billion in annual tax liabilities has failed to be paid by small businesses. The figure indicates the gap between what businesses should be paying and what they actually pay. This results in the Australian Taxation Office facing billions of dollars in lost revenue. A significant portion of the $11 billion is from honest mistakes and poor record keeping by businesses.  More than 1,300 business tax returns were reviewed revealing that close to 1 in 5 businesses tried to report correctly but had unknowingly made mistakes.

So, what can you do to ensure your business meets your tax and accounting obligations?

With the implementation of single-touch payroll (STP), it has made it harder for businesses to dodge or make mistakes when it comes to their tax obligations. Single-touch payroll became compulsory for small businesses as of the 1 July 2019. The 2019-2020 financial year will reveal if STP will decrease the current year’s $11 billion in unpaid tax.

To get an idea of the severity of the situation, for the 2015-16 tax year, an estimated $11.1 billion worth of tax that was owed to the tax office by small businesses was not paid. The same year, large corporate companies were estimated to owe the tax office $1.8 billion that was not paid. Due to corporate companies being ‘larger’ it is often automatically assumed that they would have larger discrepancies. However, when you think of it logically, large corporate organisations have dedicated financial departments to ensure they are compliant. The good news is, your small business can have the same knowledge and experience to back up your business.

Don’t be just another small business statistic! At Power2 Brisbane, we’re proactive in helping our clients meet their tax and accounting obligations. Not only are we accurate, we can still legally minimise your taxation obligations, provide an efficient service and help you navigate complex legislation. Click here to make an appointment today.