ATO visiting businesses soon

ATO inspection small business tax compliance

The ATO recently announced that their inspectors will be visiting around 400 small businesses with “ready access to cash” over the coming weeks. This includes businesses such as restaurants, cafes, hair and beauty salons, and building and construction businesses which, according to the ATO, have some of the highest rates of concerns reported across Australia.

Ensuring cash heavy businesses are doing the right thing

The goal of the visits to small businesses, according to the ATO’s Assistant Taxation Commissioner Tom Wheeler, “is about helping them to meet their obligations. Through the visits, we can quickly identify who needs extra support and make it easier for them to comply.”

The inspectors are mostly concerned about compliance, says the ATO. Firstly, they want to ensure that businesses with ready access to cash are doing the right thing and meeting their taxation obligations. The inspectors can help by providing “the tools and information they need to correctly register, lodge on time, maintain accurate business records, and correct any mistakes,” said an ATO spokesperson.

Identifying businesses not meeting their obligations

Their second goal is to help businesses who are doing the right thing, by identifying those who aren’t. The ATO spokesperson said that “We also collect data during visits, which we may later use for audit purposes with businesses that are doing the wrong thing.”

They look at a number of factors that might indicate inaccurate reporting, such as “unrealistic income” based on the lifestyle and purchases of the owner, or simply industries with a history of under-reporting income or direct reports of tax evasion.

“We then work to protect honest businesses from unfair competition by taking action against those who do the wrong thing,” said Wheeler.

Keeping on top of your obligations

While the initial round of visits is focused on Perth and Canberra, it’s likely that the same strategy will be rolled out in Brisbane and other centres in the near future.

The key to avoiding the ATO’s scrutiny is, of course, to stay compliant. If your business has access to a lot of cash, the ATO is likely to look more closely at your records than one that has mostly non-cash transactions.

This whole program highlights a more intensive and rigorous approach to monitoring compliance from the ATO across the board.


If you’re concerned about meeting your lodging or reporting commitments, it’s best to talk to your accountant to make sure you’re fully compliant and prepared to pay on time. We can help you establish or maintain a plan that works for you and removes the headache and worry of compliance. Just give us a call on 07 3822 7201 to book your appointment.