Welcome to our September 2019 edition of the StewartBrown newsletter. We hope to keep you informed of the important tax developments and issues affecting businesses in Australia today. STOP PRESS – SINGLE TOUCH PAYROLL (“STP”) ACTION REQUIRED BEFORE 30 SEPTEMBER As reported in our July 2019 newsletter and our special STP newsletter of June 2019, employers are required to register with the ATO by 30 September 2019 (at the latest). According to the ATO less than half of employers had registered for STP by the end of July 2019. If you have not already done so please attend to this ASAP and seek assistance from your StewartBrown Partner or Manager if you need any assistance with STP. NO TAX DEDUCTION FOR NON COMPLIANT PAYMENTS From 1 July 2019, tax deductions will not be allowed for payments that Pay-as-you-go with-holding (“PAYGW”) obligations relate to if the payer either fails to withhold that tax or notify the Tax Commissioner concerning same. These measures apply to: salary, wages, commissions, bonuses or allowances to employee; directors’ fees; payments under a labour hire arrangement; payments for supply of services (except from supplies of goods and real property) where the payee has not quoted its ABN; or non-cash benefit provided in lieu of one of the above. Tax Deduction A tax deduction will only be denied where: no amount has been withheld at all; or no notification is made to the Commissioner. Withholding or notifying the ATO of an incorrect amount will not affect tax deductibility however penalties may apply! These rules do not apply to an obligation to withhold or report a nil amount. A tax deduction that would otherwise be denied by these measures, will be maintained in the original income year if the taxpayer voluntarily notifies the ATO of the mistake before an ATO audit commences. With the introduction of Single Touch Payroll it is a lot easier for the Tax Office to monitor and review non payment of PAYGW and the reporting of those obligations. If you need any assistance with these responsibilities please contact your StewartBrown Partner or Manager. DIRECTORS PENALTY REGIME - UPDATE The Directors Penalty Regime allows the Tax Commissioner to make directors of a company personally liable for specified taxation liabilities of the companies they represent through the issue of a Director Penalty Notice (“DPN”). A DPN imposes the penalty on the directors of a company that fails to pay Pay-as-you-go with-holding taxes (“PAYGW”) and Superannuation Guarantee Charges (“SGC”). Unpaid FBT, GST and corporate income tax are not currently covered by these regulations. The amount of the director penalty notice is the amount of unpaid liabilities for PAYGW or SGC. Former company directors remain liable for DPN penalties equal to any unpaid PA