Practice Update – March 2025

Lowe Lippmann Chartered Accountants

How to master employer obligations in 2025

Taxpayers who employ staff should remember the following important dates and obligations:

Fringe benefits tax (FBT)

31 March 2025 marks the end of the 2024-25 FBT year. Employers should remember the following regarding their FBT tax time obligations.

They should identify if they have provided a fringe benefit. If they have, they should determine the taxable value to work out if they have an FBT liability.
They should lodge an FBT return and pay any FBT owed by 21 May 2025. If their registered tax agent lodges electronically for them, they have until 25 June 2025.
They should keep the right records to support their FBT position.

Pay as you go (PAYG) withholding

Taxpayers need to withhold the right amount of tax from payments they make to their employees and other payees, and pay those amounts to the ATO.

Single touch payroll (STP)

Employers should finalise their STP data by 14 July 2025 for the 2024/25 financial year (there may be a later due date for any closely held payees).

Super guarantee (SG)

28 January, 28 April, 28 July and 28 October are the quarterly due dates for making SG payments
The SG rate is currently 11.5% of an employee's ordinary time earnings. From 1 July 2025, it will increase to 12.0%.
Taxpayers should ensure SG for their eligible employees is paid in full, on time and to the right super fund, otherwise they will be liable for the SG charge.

ATO's tips to help taxpayers stay on top of their BAS

The ATO has the following tips to help taxpayers get their BAS right before they lodge:

They should make sure they enter the figures for their obligations at the correct label, and only complete applicable fields.
If lodging online, or through a registered tax or BAS agent, they may be able to get an extra 2 or 4 weeks to lodge and pay.
If they have nothing to report for the period, they can lodge a 'nil' BAS online by selecting 'Prepare' and then 'Prepare as nil', or they can call the ATO's automated service "any time of the day".
If they made a mistake on their last BAS, instead of lodging a revision, they may be able to use their current BAS to fix it. For example, they can use label 1A to adjust GST on sales, or label 1B to adjust GST on purchases.
They can also use their BAS to vary an instalment amount.

Claiming fuel tax credits when rates change

Fuel tax credits changed on 3 February, and taxpayers could receive more savings for fuel they have acquired on and from this date. Different rates apply based on the type of fuel, when it was acquired and what activity it is used for.

The ATO has the following tips for taxpayers to ensure they are claiming correctly.

They can use the ATO's 'eligibility tool' on its website to find out if they can claim fuel tax credits for fuel they have acquired and used.
They can use the ATO's online fuel tax credit calculator (which should automatically apply the right rate) to work out their claim.
They can lodge their BAS via Online services or a registered tax or BAS agent (lodging via an agent can allow them extra time to lodge and pay).

ATO "busts" Not-For-Profits myths

As the Not-for-profit (NFP) self-review return is due in March, the ATO has recently published a document 'busting' various NFP 'myths'.

Taxpayer's claim for input tax credits unsuccessful

In a recent decision, the Administrative Review Tribunal (ART) rejected a taxpayer's claim for input tax credits on the basis that all the relevant GST returns (ie. BASs) were lodged out of time.

For the GST periods from 1 October 2015 to 31 March 2017, the taxpayer filed each of her GST returns more than four years after they were due. The taxpayer still claimed input tax credits totalling over $10,000 for this period.

The ATO disallowed this claim, on the basis that none of the input tax credits were claimed within the four-year period, as required by the GST Act.

The ART upheld the ATO's decision, noting that, as the taxpayer did not file the GST returns within the four-year period "she did not have input tax credits taken into account . . . As a consequence, . . . (she) simply ceased to be entitled to those input tax credits."

ATO's appeal against decision that UPEs are not "loans" fails

The Full Federal Court recently dismissed the ATO's appeal against an AAT decision that unpaid present entitlements (UPEs) owing by a trust to a corporate beneficiary were not "loans" for Division 7A purposes.

A corporate beneficiary had become entitled to a share of the income of a trust for the 2013 to 2017 income years. Parts of these entitlements remained outstanding, resulting in UPEs. The ATO treated these UPEs as loans from the corporate beneficiary back to the trust (and, in consequence, as "deemed dividends" made to the trust).

The AAT held at first instance that a loan had not been made in this case.

The Full Federal Court upheld the AAT's decision, noting that a loan for Division 7A purposes requires an obligation to repay an amount, not merely the creation of an obligation to pay an amount (such as when a trust distributes income to a beneficiary).

We recently prepared a detailed Tax Alert on the Bendels Case decision, to read click here.

Please do not hesitate to contact your Lowe Lippmann Relationship Partner if you wish to discuss any of these matters further.

Liability limited by a scheme approved under Professional Standards Legislation

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Practice Update – November 2026

November 4, 2026

ATO to continue accepting credit cards until 30 June 2027, but the clock it still ticking Last month, in our Practice Update for October 2026 ( see here ), we noted the Australian Tax Office ( ATO ) announced it will stop accepting credit cards as a payment method after 30 November 2026, following the Reserve Bank of Australia’s ( RBA ) ban on card surcharges from 1 October 2026. The ATO has since confirmed that it will continue to accept credit card payments for tax obligations until 30 June 2027 . After 30 June 2027, taxpayers who wish to continue using a credit card to meet their tax obligations may continue to use third-party payment providers as outlined at www.ato.gov.au/howtopay What do these change mean for you? The extension does not cancel the planned withdrawal of direct credit card payments. From 1 July 2027, you will need to use another method to pay the ATO directly. Available alternatives include: Debit card BPAY Bank transfer Direct debit Payment at Australia Post (where available) International money transfer services (where applicable) Some third-party payment providers may continue to offer ways to pay tax using a credit card after the deadline. However, these services may charge additional fees and take longer to process payments. Check the total cost, processing time and payment conditions before relying on one. Why does your payment method matter? Credit cards can help bridge short-term cash-flow gaps, but the convenience comes at a cost. Interest, annual fees and other charges can erode the benefit, particularly if you regularly carry a balance. There is also a risk that a payment will not be processed in time, potentially leaving you with an overdue tax liability and additional interest. Switching to BPAY, bank transfer or direct debit may provide a simpler and more predictable way to manage tax payments. The right option will depend on your circumstances, including when funds are available in your business account and whether you need to retain flexibility over payment dates. Pay particular attention if you have an existing ATO payment plan linked to a credit card. The ATO has been contacting affected taxpayers, but you should check your own arrangements rather than assume they will continue unchanged. Confirm how future instalments will be paid and allow enough time to update the payment method before the deadline. What should you do now? Use the extended timeframe to prepare rather than leaving the change until the last minute. Review your current arrangements. Check whether you use a credit card for one-off tax payments, regular instalments or an ATO payment plan. Choose an alternative. Consider which payment method best suits your cash-flow cycle, taking account of fees and processing times. Update recurring payments early. Make sure any new arrangements are in place well before 30 June 2027 and check that payments are processed successfully. Review your cash flow. If you rely on the credit card interest-free period to manage tax liabilities, consider whether you need to set aside funds earlier or adjust your payment planning. Seek advice if needed. If tax payments are putting pressure on your cash flow, speak with us early so we can help you review your position and consider practical ways to manage upcoming liabilities. The extension to 30 June 2027 gives businesses more time to adjust, but it should not be mistaken for a permanent reprieve. Planning ahead can help you avoid unnecessary fees, missed payments and last-minute disruption when the ATO’s direct credit card facility closes.

Practice Update – October 2026

October 7, 2026

ATO to stop accepting credit cards as payment method after 30 November 2026 The Australian Tax Office ( ATO ) has announced it will stop accepting credit cards as a payment method after 30 November 2026. The move follows after the Reserve Bank of Australia’s ( RBA ) Review of Merchant Card Payment Costs and Surcharging, where the RBA concluded that “it is in the public interest” to scrap surcharging for all designated card networks from 1 October 2026 (including EFTPOS, Mastercard, and Visa). It said that as a government agency, the ATO has decided it would not be appropriate for the cost of credit card merchant fees to be transferred to the community. The ATO recognises that some taxpayers currently rely on credit card payments to manage their tax payments and understands this change may require some adjustments. The ATO is writing directly to those who currently have a payment plan linked to a credit card to explain the changes and outlining the steps they need to take. There are alternative payment options available for taxpayers, including direct deposit, direct debit from a debit card, direct debit from an Australian cheque or savings account, Government EasyPay, in person at Australia Post, by mail, or international money remitter. The ATO said it is committed to helping taxpayers transition to alternative payment methods and will continue to support those experiencing financial hardship or other circumstances that make it difficult to meet their obligations. Alternative payment options for taxpayers are outlined at www.ato.gov.au/howtopay Taxpayers who need extra support are encouraged to visit www.ato.gov.au/supporttolodgeandpay , contact the ATO on 13 11 42 during business hours or speak with their registered tax professional.

Tax Alert - Draft legislation offers alternative to restructuring and avoid the 30% minimum trust tax

September 4, 2026

Yesterday, Treasurer Jim Chalmers released draft legislation to implement the key components of the 30% minimum trust tax on discretionary trusts announced in the Federal Budget during May 2026.