Both measures are intended to interact with each other, with temporary full expensing designed to encourage new investment that might result in a tax loss.
While tax returns lodged on or after 1 July will soon be updated with new labels, businesses who have an early balancer substituted accounting period or need to lodge a tax return for part of the year can now complete specific ATO forms to access the measures before 1 July.
For taxpayers seeking to claim a loss carry-back offset before 1 July, the ATO has recommended lodging the claim form five days before they lodge the company tax return to prevent delays.
“If there’s a refund payable, then we’ll be able to get that refund processed more quickly,” said ATO assistant commissioner Kasey MacFarlane on a recent podcast.
“Now, if people don’t actually lodge that form five days before and they say do it two days before or do it at the same time as the tax return, it’s not that it won’t get processed or they’ll miss out, but it’s just that it might take us a little bit longer.”
Businesses looking to claim the loss carry-back tax offset have also been urged to start reviewing their opening and closing franking account balance, their aggregated turnover for each loss year, and the amount of tax losses that they are carrying back.
For businesses accessing temporary full expensing, they will need to work out the number of assets they are claiming or opting out for, the value of the assets, the total amount of their temporary full expensing deduction, information about their aggregated turnover, and whether they are using the alternative income test.
Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.