Option 1: Leave the current Option 2: Mandatory real time Option 3: Mandatory real time Alternate option ruled out processes in place reporting of tax and reporting and mandatory real time prior to further superannuation obligations at the payment of tax and superannuation consultation: Voluntary time of the payroll event, and the obligations at the time of the real time reporting and option to voluntarily make payroll event. voluntary payment of tax payments in real time. and superannuation obligations at the time of the payroll event Positive and negative aspects of the options Pros Pros Pros Pros Changes will emerge as a Cutting red tape for businesses Cutting red tape for businesses - A further gradual result of the broader digital - $2.0 billion over 10 $2.6 billion over 10 years. update/increase of agenda which will see the (aggregate of Phase 1) Creates a foundation for digital services will majority of businesses Creates a foundation for increased efficiency across encourage employers to transacting electronically increased efficiency across government through cross move to new software with the ATO by 2018. government through agency sharing of real time over time. agency sharing of real time reported information. Employers will gradually reported information. Creates a foundation for a choose to transact Cons Creates a foundation for a modern taxation system. digitally once they can Existing regulatory burden is modern taxation system. Provides incentive for business see the benefits of not reduced for employers Protecting employee tax and compliance through monitoring so (i.e. similar to the (i.e. reporting and superannuation contributions of employer response to tax and experience). onboarding) by providing early visibility of superannuation reporting and Does not promote employers not meeting their payment obligations. efficiencies through cross obligations. Protecting superannuation and Cons agency sharing of real time Increased ability for ATO to government revenue. Broader government reported information. pre-fill information to Increased ability for ATO to service delivery streamline tax return information to streamline tax benefits and the preparation. return preparation. improved integrity in the PAYG Withholding
Option 1: Leave the current processes in place Option 2: Mandatory real time reporting of tax and superannuation obligations at the time of the payroll event, and the option to voluntarily make payments in real time. Option 3: Mandatory real time reporting and mandatory real time payment of tax and superannuation obligations at the time of the payroll event. Alternate option ruled out prior to further consultation: Voluntary real time reporting and voluntary payment of tax and superannuation obligations at the time of the payroll event Positive and negative aspects of the options Pros Changes will emerge as a result of the broader digital agenda which will see the majority of businesses transacting electronically with the ATO by 2018. Cons Existing regulatory burden is not reduced for employers (i.e. reporting and onboarding) Does not promote efficiencies through cross agency sharing of real time reported information. Pros Cutting red tape for businesses - $2.0 billion over 10 (aggregate of Phase 1) Creates a foundation for increased efficiency across government through agency sharing of real time reported information. Creates a foundation for a modern taxation system. Protecting employee tax and superannuation contributions by providing early visibility of employers not meeting their obligations. Increased ability for ATO to pre-fill information to streamline tax return preparation. Pros Cutting red tape for businesses - $2.6 billion over 10 years. Creates a foundation for increased efficiency across government through cross agency sharing of real time reported information. Creates a foundation for a modern taxation system. Provides incentive for business compliance through monitoring of employer response to tax and superannuation reporting and payment obligations. Protecting superannuation and government revenue. Increased ability for ATO to information to streamline tax return preparation. Pros A further gradual update/increase of digital services will encourage employers to move to new software over time. Employers will gradually choose to transact digitally once they can see the benefits of so (i.e. similar to the experience). Cons Broader government service delivery benefits and the improved integrity in the PAYG Withholding