The newly customised BAS and IAS forms currently being sent out by the ATO have been welcomed by industry groups, with the Institute of Chartered Accountants in Australia (ICAA) saying the new forms will have inherent benefits in the long term.
ICAA tax counsel Brian Sheppard says while some businesses may be confused by the changes, after the initial reaction he is sure "they will start to appreciate the benefits of the redesign".
"I feel business will also appreciate the more logical flow in the data completion process of the new forms," Sheppard says.
"This now runs front to back, but retains the familiar box references. However the forms and the instructions, of necessity, cram a lot of detail into limited space, and at first glance this could be off-putting.
"As an example, the BAS Basics reminds us that apart from the reporting options available, we also have to consider possible qualification for the criteria of the ‘Simplified Accounting Method', the ‘accounts method', and from 1 July 2001, the ‘Simplified Tax System'."
He says taking the time to read the fine print carefully is commonsense advice worth repeating.
"We understand that the ATO will continue to look at more finetuning changes based on feedback from the business community, but at the end of the day, there are limitations in what can be achieved in chasing the elusive goal of form simplicity.
"The painful truth is that the BAS and IAS are the reporting documents for a complex tax administration system.
Sheppard says areas of change that warrant further attention are:
- greater access to simplified accounting methods, for a wider range of industries with better targeted turnover-to-profit ratios
- simplification of private use adjustments for GST credits, perhaps allowing the option of tax deductibility of GST instead of allowing the input-tax credits for SME's where the compliance costs of allocating the credit across business and private use exceeds the tax benefit
- correction of emerging anomalies, such as the inability of cash-basis taxpayers to claim input-tax credits up front on hire purchase acquisitions, rather than as the hire purchase payments are made.
Last week's story on the new BAS forms is
here.