4 tax return changes in 2024 accountants need to know
Tax time 2024 has begun around Australia. At The Access Group, we want accounting practices to feel as prepared for upcoming compliance changes as possible.
In this article, we’ll give you an overview of four key tax return changes from the Australian Taxation Office (ATO) for 2024.
Our advice on these changes comes courtesy of Michael Wright, our Head of Product for Tax at the Access Group, APAC.
Temporary full expensing
Temporary full expensing will be coming to an end this financial year. This measure was introduced to help Australian businesses recover from the economic impact of COVID-19 and was always intended to be a short-term measure.
Temporary full expensing encourages eligible businesses to claim an immediate deduction for the business portion of asset costs in the year they are first used or installed for taxable purposes.
The provisions for temporary full expensing ended on the 30th of June 2023, which means expenses incurred from the 1st of July 2023 cannot be claimed as deductions.
For more information on this measure and what its removal means for your firm, check out the temporary full expensing section on the ATO website.
Loss carry back tax offset
The loss carry back tax offset is another measure introduced during COVID and will be removed from the 2024 returns.
Loss carry back was a refundable tax offset for eligible corporate taxpayers to claim for losses in the 2019–20 to 2022–23 tax income years.
From the 2023-24 finance year onwards, eligible corporate tax entities will no longer need to deduct the carry back from their losses when completing a losses schedule or a consolidated group losses schedule as part of their next tax return.
For more information on this measure and what its removal means for your firm, check out the loss carry back tax offset section on the ATO website.
The Modernisation of Trust Administration Systems (MTAS) project
The Modernisation of Trust Administration Systems (MTAS) project was announced in the March 2022 budget to digitalise trust income reporting and processing.
This strategy was announced to develop systems that ensure all trusts can lodge income tax returns electronically. Digitalising the reporting of trustee and beneficiary obligations will improve income information's quality, accuracy and integrity and reduce errors and processing times.
The MTAS project will be implemented from 1st July 2024. For further details on MTAS, including the project scope, check out the ATO webpage.
Enhanced prefill for welfare amounts
Enhanced prefill for welfare amounts is a change that the ATO has been looking to implement for some time.
Prefilling has become more commonplace in Australia's tax returns in recent years. Accountants can use pre-filling to cross-check information provided by their clients with data obtained by various organisations. This helps to create an accurate picture of their income and expenses.
As of this tax time, welfare amounts will also be prefilled, showing a value for Australian Government Pensions and Allowances. Any amounts accountants will see are not easily changeable, and an adjustment reason code is needed to make any changes.
For more information about the ATO's pre-filling service, click here.
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We hope our article has helped prepare you for tax time by updating you on key compliance changes for this tax year.
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