ATO releases instructions for new annual GST return
The Tax Office has issued instructions for completing the supplementary annual GST return being introduced for large businesses.
In an update yesterday, the ATO published further information on the supplementary annual GST return being rolled out to public and multinational businesses that have had a GST review.
The Tax Office has also issued instructions which explain how to complete each section of the supplementary annual GST return.
The ATO previously stated that the GST return was part of its work to better tailor its engagement with taxpayers under its Top 100 and Top 1,000 Justified Trust programs for GST.
The return is being introduced for the 2024–25 financial year, for those taxpayers who received a GST assurance report on or before 30 June 2024 with a GST assurance rating.
The Tax Office said the information provided in the annual return will enable more targeted and less resource-intensive justified trust reviews for many taxpayers.
"The return is simple to complete and targeted at understanding key governance and GST changes during the year," the ATO said.
"Taxpayers who have achieved high levels of assurance are expected to benefit most as they've already adopted best practice governance and systems practices."
The ATO is implementing a pilot program as part of the rollout of the new return.
The Tax Office will initially ask a small number of Top 100 and Top 1,000 taxpayers to respond to the return questions as part of their assurance reviews.
"This pilot will focus on the clarity and functionality of the questions," it said.
The return will cover:
- How the business has actioned recommendations, areas of low assurance or red flags outlined by the ATO in its most recent GST assurance review (including subsequent interactions with the ATO).
- Whether the business has maintained or increased its level of GST governance and if it had any material business or systems changes that impacted its GST control framework since its last GST assurance review.
- The reconciliation between the business's audited financial statements and its annualised business activity statements.
- Whether it has taken any material uncertain GST positions in the period.
- Whether it identified any material GST errors in the period, how these have been rectified, and whether it has claimed any material amounts of credits in the period that were referable to earlier periods.
The ATO explained that any taxpayers required to lodge the supplementary annual GST return under Division 31 of the GST Act will receive a notice under this provision requiring them to lodge the return by the specified due date.
"Division 31 enables us to require taxpayers to lodge a fuller or further GST return for a tax period or a specified period. It enables us to require information to be provided relating to the tax period to which the return relates, or one or more preceding tax periods, or to both," the Tax Office said.
"The supplementary annual GST return is a further return with a due date that aligns with an existing activity statement due at least 7 months after the end of the financial year.
"For instance, for June balancers, the 2024–25 supplementary annual GST return will be an additional return for the January 2026 period, due by 21 February 2026. The return will require information to be provided about the period 1 July 2024 to 30 June 2025."
The ATO noted that the supplementary GST return does not replace any other GST return for the relevant period and won't impact the due dates for any activity statements, nor the 4-year entitlement period to input tax credits under Division 93 of the GST Act.
The ATO said it would use the information provided in the return to help assess the extent to which it has confidence that GST has been correctly reported and to determine the level of ongoing investment in GST governance.
"We'll also use the information provided to identify and monitor GST risks, and differentiate our approach where we do identify specific issues that require further engagement with you," it said.
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