Compliance with tax and superannuation obligations involves correctly registering in the system, lodging tax information on time, reporting complete and accurate information and paying tax obligations on time.
We are confident that the majority of businesses that should be registered in the system are registered, based on analysis of actual registrations and statistics collected by other agencies.
A steady and sustained increase in on-time lodgment of income tax returns by all types of business entities over recent years has been achieved through more effective and earlier engagement with taxpayers.
On-time lodgment of activity statements by small businesses has remained relatively stable in recent years. Our strategies had been successful in reversing a decline in activity statement lodgment performance, with on-time lodgment improving over the four-year period to 2014–15. However, this gain appears to have been reversed in 2015–16.
Since 2014–15, there has been a gradual but sustained improvement in tax payment performance, driven mainly by improvements in on-time payment of GST liabilities and company and super fund income tax liabilities. However, we have not seen improvement in the small business market (those businesses with a turnover of less than $2 million).
The overall commitment of businesses to participate in the tax and superannuation systems is demonstrated by the steady increase in the use of ATO online services. For example, there was a big increase in 2015–16 in the number of employers paying super contributions to super funds electronically under the SuperStream standard.