ATO revamps top 100 program to improve engagement
The ATO has announced changes to its top 100 justified trust programs that will see reviews become more "tailored and timely".
The ATO is enhancing its top 100 income tax and GST assurance programs to continue driving improvements in tax performance.
The top 100 population consists of the largest contributors to corporate income tax, excise, and petroleum resource rent tax (PRRT) collections. The program seeks to provide assurance that the top 100 taxpayers are reporting and paying the right amount of tax in Australia.
In a recent update, the ATO said while it has previously engaged with top 100 entities through annual income tax pre-lodgment compliance reviews, it wants to achieve real-time engagement with its reviews.
"Over the next 12 to 18 months, we'll be working with you to bring your reviews into real time. The timeframe will depend on your willingness and ability to achieve this," the Tax Office said.
"To achieve this, we'll do simultaneous, tailored reviews across multiple ‘back years’, if needed, and tailor our engagement based on your situation."
The ATO said it is encouraging those in the top 100 program to make pre-lodgment disclosures during a pre-lodgment compliance review or regarding GST affairs to enable early engagement on significant matters in real-time.
"We've released new guidance about our expectations of you and what we'll be doing."
The ATO said it would be focused on how it can scope and tailor its engagements with those in the programs. Where an entity has reached a high assurance, the ATO said it would partner with them to help them maintain it and use prior assurances where possible.
The Tax Office warned it would more intensively scrutinise tax affairs where an entity is yet to obtain a sufficient assurance level.
"We've observed that 'high' assurance taxpayers maintain their rating over multiple reviews. High assurance taxpayers will now benefit from a third monitoring and maintenance year, meaning reduced engagement with us and help to achieve real-time engagement," it said.
"To further streamline reviews, if you're an entity that's wholly or substantially domestic in operations and ownership, with predominantly domestic transactions, we'll no longer be doing the effective tax borne calculation in our monitoring and maintenance reviews and refresh reviews (unless there's exceptional or changed circumstances)."
The ATO said it would take a tailored approach to GST data and transaction testing.
"Our testing will be informed by our understanding of your situation across the four focus areas including tax governance, tax risks flagged to market, correct reporting, and the GST analytical tool," the Tax Office said.
The ATO said it previously needed to achieve 75 per cent sufficient coverage of a top 100 economic group's GST throughput by doing a GST assurance review for one or more entities in that group.
"We'll now be able to obtain sufficient coverage through a combination of GST assurance reviews and specific reviews for additional reporters," it said.
"We'll aim for 75 per cent through an assurance review of at least 2 GST reporters (including the largest GST reporter). Where this isn't possible, we'll get this coverage through at least two assurance reviews that cover a minimum of 50 per cent per cent of the group's GST throughput, with the balance being specific reviews to reach the 75 per cent metric."
