Blog Details

As we head into the weekend, it’s important for business owners, property investors, and high-value asset owners to stay informed about key regulatory changes. The Australian Taxation Office (ATO) is ramping up its data-matching efforts, and new superannuation payment requirements are set to take effect. Here’s what you need to know.

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Investment Properties Under the Microscope

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The ATO has long focused on property investors, monitoring what is reported and claimed on income tax returns. In addition to previous programs involving residential property loan data and landlord insurance, a new initiative has been introduced. From the 2018-19 financial year through to 2025-26, the ATO will collect data directly from property management software, including:

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• Owner Information: Names, addresses, contact numbers, and ABNs (if applicable).
• Property Details: Address, rental availability date, property manager information, and linked bank accounts.
• Rental Transactions: Income and expenses, lease periods, and account balances.

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Since 2016, the ATO has also been receiving property transfer data from state and territory governments, further tightening its focus on landlords. The primary goal is to identify:

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• Underreported rental income.
• Incorrect or excessive deduction claims.
• Failure to declare capital gains tax (CGT) events.

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Scrutiny of High-Value Lifestyle Assets

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The ATO is also reviewing ownership details of high-value assets through data provided by insurance companies. These assets include:

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• Caravans and motorhomes valued at $65,000 or more.
• Vehicles and motorcycles worth $65,000 or more.
• Fine art valued at $100,000 or more.
• Boats and marine vessels worth $100,000 or more.
• Aircraft valued at $150,000 or more.

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The ATO is collecting detailed information on asset ownership, including purchase records and intended use. Special attention is being given to cases where asset improvements, disposals, or personal use may not have been properly reported. This includes potential errors in GST credits and Fringe Benefits Tax (FBT) claims related to business-owned assets used for personal purposes.

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Payday Super: A Major Shift in Superannuation Payments

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Significant changes are coming to how superannuation payments are managed. From July 2026, employers must align super payments with employees’ paydays rather than the current quarterly schedule. This shift aims to close the $3.4 billion gap between what’s owed and what’s been paid, potentially increasing retirement savings by around 1.5% for a 25-year-old median-income worker.

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Key Changes at a Glance:

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• New Payment Schedule: Super contributions must reach employees’ funds within 7 days of their payday.
• Exceptions: New employee payments (within the first two weeks) and certain irregular payments outside the regular cycle.
• Single Touch Payroll (STP) Integration: The new system will utilize STP reporting to streamline compliance.
• Cash Flow Impact: Employers must adjust to paying 12% of payroll more frequently, requiring better financial planning.

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Penalties for Late SG Payments

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Late Superannuation Guarantee (SG) payments will result in significant penalties under the Payday Super system:

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• Outstanding SG Shortfall: Calculated based on Ordinary Time Earnings (OTE) rather than total salaries and wages as is currently done.
• Notional Earnings: Daily interest on the shortfall amount from the day after the due date, calculated at the general interest charge rate on a compounding basis.
• Administrative Uplift: An additional charge imposed to reflect enforcement costs, calculated as an uplift of the SG shortfall component of up to 60%, subject to reduction if employers voluntarily disclose their non-compliance.
• General Interest Charge: Interest will accrue on any outstanding SG shortfall and notional earnings, along with any outstanding administrative uplift penalty.
• SG Charge Penalty: Extra penalties of up to 50% of the unpaid SG charge apply if amounts are not fully paid within 28 days of the notice of assessment.

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The updated SGC will be tax deductible (excluding penalties and interest), unlike the current system where deductions aren’t allowed.

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How Does This Affect Your Business?

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• Better Compliance: Regular payments can prevent businesses from falling behind, especially in financial difficulty.
• Improved Employee Benefits: Prompt payments give employees’ super funds a better chance to grow over time.

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Preparing for Payday Super

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Though Payday Super is not yet law, businesses should start preparing for these changes. We’ll continue to provide updates to help you stay compliant before the 1 July 2026 deadline.

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How We Can Help

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Navigating these ATO initiatives and superannuation changes requires a proactive approach to ensure compliance while optimizing your tax position. Our team of specialists can assist by:

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• Reviewing Your Tax Strategy: Aligning your reporting with ATO regulations.
• Ensuring Compliance: Identifying and rectifying potential discrepancies.
• Optimizing Your Tax Position: Maximizing allowable deductions and preparing for super payment changes.

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Take Action Today

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Don’t leave your tax and super strategy to chance. Staying informed and proactive can help protect your business, investments, and employees’ financial future.

Stay compliant, take the initiative, and continue growing your wealth!