Increased compliance activity

We are experiencing increased data matching compliance activity from State Revenue authorities. These reviews can lead to additional payroll tax obligations, including penalties and interest. Even if they do not, the cost and distraction of the audit is a problem in itself.

Data matching

So, what are the sources of data being utilised? Depending on the size or structure of the employer’s business, a range of data sources will be available for regulators to cross-check using AI and other means. These sources could include one or more of the following:

• Financial statements.
• Income tax returns.
• Activity Statements.
• Single Touch Payroll (STP) reporting.
• WorkCover insurance reporting.
• Taxable Payments Annual Reports.

Good governance

In dealing with all compliance, employers must ensure they consider the increased data matching being utilised by government departments – including the State Revenue authorities – and ensure the appropriate actions are being taken in the form of advising payroll monthly and providing an annual reconciliation. Complying with these obligations will help to minimise the risk of errors and subsequent penalties, and also of unwelcome and potentially unwarranted audit activity. If these actions are not taken, this problematic compliance activity can result in unpaid tax interest and penalty tax being charged to the employer.

Annual payroll tax reporting

With annual payroll tax returns due imminently, we recommend performing these reconciliations as part of annual processes for businesses.

Contact Pilot

If you would like assistance with your payroll tax compliance matters, contact Murray Howlett, Tom Howard or your Pilot advisor on (07) 3023 1300.