Autumn 2026

Tax Alert March 2026

ATO tightens compliance and expands employer support

The ATO has released several new resources, including a checklist to help employers get ready for what it calls a “once-in-a-generation change” along with an updated guidance on commercial deal tax.

Here’s a roundup of the latest news.

Preparing for Payday Super

The ATO has issued a Payday Super Checklist to help employers prepare for the commencement of the new regime from 1 July 2026.

The timeline checklist is designed to help employers understand the new requirements, plan their transition, prepare their business systems and processes and switch to paying super each payday.

In addition, Practical Compliance Guidelines outlining the ATO’s compliance approach during the Payday Super legislation’s first year of operation, have now been released.

Barter credit tax scheme under the microscope

The ATO is warning taxpayers to steer clear of an emerging tax scheme involving barter credits, a form of alternative currency used in some business networks.ⁱ

The scheme involves artificially inflating deductions by claiming donations of barter credits to deductible gift recipients. This practice is unlawful and may trigger a tax audit and significant penalties.

According to the ATO, the scheme is enabled by barter exchanges issuing credits with a nominal face value far higher than the amounts actually paid by participants.

Get certainty on commercial deals

To help business owners understand the tax implications of proposed commercial transactions, the ATO has created a series of case studies and videos.

The current case studiescover a range of scenarios, including a small business capital gains tax (CGT) rollover for a primary production business, the CGT implications when two siblings wish to sell family company shares to a third sibling, and the restructuring of a small company and subsequent share sale.

The information resources are designed to show how engaging early with the ATO can help resolve tax issues before lodgement and avoid later tax disputes.ⁱⁱ

Protect your GST and fuel tax credits

Some taxpayers are missing out on GST and fuel tax credits because they are not claiming the credits within the four-year time limit, which generally expires four years from the due date of the original BAS in which the credits should have been claimed.

Lodging an amendment or voluntary disclosure does not protect these credit entitlements, as the ATO must process amendments and include it in your tax assessment within the time limit.ⁱⁱⁱ

Once GST and fuel tax credit entitlements expire, the ATO has no discretion to amend a tax assessment to include the credits. Good processes and regular reviews are essential to avoid missing out.

Avoiding delays when winding up SMSFs

The ATO is reminding trustees to follow the correct procedure when winding up their SMSF if they wish to avoid errors and delays.^iv

Trustees have 28 days after lodging their final SMSF annual return (SAR) to complete the final rollover before the fund can be officially wound up. Failing to roll out all member benefits can result in significant delays, an inability to use SuperStream and requires lodgement of an additional SAR if assets remain after the wind-up date.

Trustees need to keep their contact details updated, promptly finalise outstanding transactions and pay debts, close the SMSF bank account only after confirming the wind-up, and roll over most of the fund’s asset before lodging the final SAR.

ATO help with natural disasters

Following the series of natural disasters around the country, the ATO is reminding taxpayers that support is available for those affected by disasters such as bushfires, cyclones, drought, flood or storms.^v

For major disaster areas, the ATO may pause correspondence and provide extra support depending on circumstances. This may include:

• extra time to pay tax debts
• more time to lodge tax returns, BAS or other obligations
• personalised payment plans
• remission of penalties or interest charged during the affected period.

If you need more information or clarification about any of the recent tax changes, please give us a call.

i ATO warns about barter credit tax scheme | Australian Taxation Office

ii Commercial deals service resources | Australian Taxation Office

iii Act early: Protect your GST and fuel tax credit entitlements | Australian Taxation Office

iv Get it right! Avoid delays when winding up your SMSF | Australian Taxation Office

v Summary of our disaster support | Australian Taxation Office

Got a side hustle? Don’t forget your tax

With the ongoing cost-of-living squeeze, record numbers of Aussies are supplementing their income with side hustles.

But before you dive into a new gig, it’s important to understand some of the tax essentials that come with running a small business.

Whether you’re monetising online content creations, or running bootcamp sessions, the ATO may consider that you’re running a business and expect you meet your tax obligations.

Are you running a business?

Under the current tax rules, if you earn money through continuous and repeated activities to make a profit, it’s likely you are considered to be carrying on a business.ⁱ

Income from genuine hobbies is non-assessable, but income from a business must be declared in your tax return.ⁱⁱ

Business operators face a range of obligations including applying for an Australian Business Number (ABN) and registering for pay as you go (PAYG) withholding if you hire any employees.ⁱⁱⁱ

There is no legislative definition of “carrying on a business” but the ATO provides information and questions to help you decide:

Step 1: Identify relevant, related activities, including:

• keeping records
• obtaining and maintaining licences and permits
• renting out premises or goods
• providing goods or services.

Step 2: Are the activities a business?

• Do you intend to be in business?
• Do you intend to make a profit and is there a realistic chance of doing so?
• Is the size or scale of your activity enough to make a profit?
• Are the activities repeated and continuous?
• Are your activities planned, organised and carried out in a business-like manner?

Accurate recordkeeping from the start

It’s important to set up a recordkeeping system from day one to track your income and expenses accurately.

You’re legally required to keep records of all transactions relating to your tax, superannuation and registration obligations when you start, run, sell, change or close a business.^iv

Records need to be kept for five years,and you must be able to show the ATO your records if required.

Claiming genuine business-related expenses

If your side hustle is a business, all income must be declared, regardless of the amount.

The good news is you can claim tax deductions for business expenses, provided you keep receipts and the expenses directly relate to earning side hustle income (including the cost of managing your tax affairs).

If your annual turnover exceeds $75,000, you must register for Goods and Services Tax (GST) and pay all the GST collected on your taxable sales to the ATO every quarter.^v

Managing cashflow

Good recordkeeping also helps you monitor the financial health of your business and know whether your business is running at a profit or loss.

It’s crucial for managing cashflow. One of the most common reasons small businesses fail, is losing control of their cash position and unable to pay their bills on time.

ATO data matching

If you are only earning small amounts, it might be tempting to assume the ATO won’t notice if you don’t report your side hustle income. But side hustles are now an important ATO surveillance target.^vi

More than 600 million transactions are reported to the tax office each year. The ATO receives and matches data from banks, payment systems, government agencies, share registries, cryptocurrency service providers and building and construction payments.

Impact on government benefits

Extra income from your side hustle can also affect your eligibility for government benefits such as the Family Tax Benefit or Child Care Subsidy. It may also affect how much Medicare Levy surcharge you pay and when you are required to start repaying a HECS/HELP debt.

If you need help getting your side hustle onto a solid business footing, contact our office today.

i Are you in business? | Australian Taxation Office

ii What to include in your business’s assessable income | Australian Taxation Office

iii PAYG withholding | Australian Taxation Office

iv Overview of record-keeping rules for business | Australian Taxation Office

v GST – Goods and Services Tax | Australian Taxation Office

vi Side hustles are front of mind this tax season | Australian Taxation Office

What the RBA wants Australians to do next to fight inflation – or risk more rate hikes

When the Reserve Bank of Australia (RBA) board voted unanimously to lift the cash rate to 3.85% in February, the decision was driven by one overriding concern. It wants to stop the rising cost of living from becoming entrenched.

For some, like self-funded retirees, the rate rise was good news. Higher interest means their savings and term deposits will earn more. But for many others, including first home buyers who might have stretched themselves just to get a foot into the housing market, it was a very bad day.

RBA Governor Michele Bullock acknowledged that, saying:

I know this is not the news that Australians with mortgages want to hear, but it is the right thing for the economy.

She warned the alternative – letting inflation keep rising – would be even harder for more Australians.

So what’s the psychology behind the RBA raising rates now and leaving the door open to further hikes if needed? And what does the central bank hope Australians will do in response?

The price squeeze you’re feeling

There’s a striking gap between how the RBA describes the economy and how most Australians experience it.

On paper, things look healthy: unemployment is low, wages are growing.

But as Bullock acknowledged, the daily reality has felt very different.

The price level has gone up 20% to 25% over the last few years, and people see that every time they walk into a supermarket, or they go to the doctor, or whatever – that’s I think what’s hurting people.

That relentless price squeeze is not something you forget, even when the rate of increase starts to slow.

What’s driving inflation up?

The headline consumer price index (CPI) hit 3.8% in the year to December, well above the RBA’s target band of 2–3%. The “trimmed mean” – the underlying measure the RBA watches most closely – rose to 3.3%. Both are too high and moving in the wrong direction.

Bullock singled out three factors contributing to inflation. Each behaves differently and requires a different response.

Housing was the single largest contributor to inflation in December, up 5.5% over the year. That includes rents, which rose 3.9% (or 4.2% stripping out government rent assistance), as well as insurance, utilities, and new construction costs, which rose 3% as builders passed through higher labour and material costs.

There is an irony here. Rising interest rates are intended to cool demand, but they slow housing construction. Limited supply of housing is what’s pushing rents up in the first place.

“Durable goods” are the things we buy to last, such as cars, refrigerators, washing machines, televisions and furniture. Demand for many of those has been higher in the past year.

“Market services” are items such as restaurant meals, taxis, haircuts, gym memberships, medical appointments and holiday travel.

The RBA watches these carefully, because these are services priced by supply and demand in the domestic market. Those prices tend to be “sticky”: once they start rising, they don’t come back down easily.

Wages are also a big part of market services inflation. If the people providing those services are earning more, the cost goes up.

How rate cuts made shoppers relax

This is where the behavioural psychology gets interesting.

The RBA cut interest rates three times in 2025. Each cut sent a signal, whether intentionally or not: it’s OK to spend a bit more.

And spend we did. CommBank data shows Australians spent A$23.8 billion over the two-week Black Friday period, up 4.6% on the year before.

It’s a cautionary tale about “rational expectations”. Each rate cut potentially fuelled the belief that more would follow.

If people feel like they can afford to spend, then they spend. Businesses, sensing demand, may raise their prices to match. That’s exactly the self-fulfilling dynamic central banks worry about.

The 3 ways the RBA hopes we’ll react

When prices go up, as they have been, workers ask for bigger wage rises to keep up. To pay higher wages, businesses lift prices to protect their profit margins. Together, that can create a “wage-price spiral” that becomes very hard to break.

The RBA will be hoping Australians respond to this rate rise in three ways:

• spending less
• saving more
• not asking for big wage rises (although they’d never phrase it that way).

RBA Governor Michele Bullock described raising interest rates as “a very blunt instrument” to bring inflation down, and noted setting rates is “not a science. It’s a bit of an art, really. We’ve just got to respond as best we can.”

The RBA can’t undo the price rises that have already happened. It can only try to slow down further increases.

Source: https://theconversation.com/what-the-rba-wants-australians-to-do-next-to-fight-inflation-or-risk-more-rate-hikes-274984

Why data security is everyone’s business

If you run a small business, it is easy to assume cyberattacks are mainly a problem for large organisations. In reality, small businesses are increasingly targeted because attackers know security is often lighter, while business and customer data, may still be valuable.

Data security is no longer optional. It is part of running a professional, modern business.

What high profile data breaches have shown us

Some of the most well known data breaches in recent years, provide an important lesson for businesses of all sizes.

The Optus data breach exposed the personal information of millions of customers, including names, dates of birth and identification numbers. Not long after, Medibank confirmed a major cyberattack that resulted in sensitive health data being stolen and later released publicly. These incidents had a significant impact on customer trust and resulted in ongoing financial and legal consequences.

These organisations had large budgets and dedicated security teams. The takeaway for small business owners is simple. Cybercriminals look for weaknesses, wherever they exist.

The impact on small businesses

For a small business, a data breach can be overwhelming. The average cost of cybercrime on small businesses jumped 14 per cent to $56,600 in 2024-25.ⁱ Financial costs can include system repairs, professional support, lost sales and potential penalties. Even more damaging, can be the loss of customer confidence.

There is also the emotional and operational toll. Responding to a cyber incident takes time, focus and energy, often pulling attention away from customers and daily operations when you can least afford it.

Protecting your business data

Good data security starts with knowing what information your business holds. Many businesses collect data over time and forget it exists. The more data you store, the more attractive a target you become to cyber attackers.

Here are some ways to protect your business:

Limit access – Only give access to people who genuinely need it. If staff don’t need to see certain customer data, don’t let them.

Use strong, unique passwords – Passwords should be hard to guess and not reused across accounts. Consider using a password manager to make this easier.

Keep systems updated – Software and devices should always be up to date. Many attacks exploit old software with known vulnerabilities.

Encrypt sensitive data – Data stored on computers, cloud systems, or sent over the internet should be encrypted. Even if stolen, encrypted data is much harder to misuse.

Back up regularly – Make regular backups of important business and customer data. Keep copies separate from your main systems so ransomware or accidental loss doesn’t affect everything.

Secure devices and networks – Use firewalls, anti-virus software, and secure Wi-Fi. If employees use personal devices, make sure they follow security guidelines.

Be aware of phishing and scams – Many breaches start with someone clicking a link or opening an infected email. Training staff and staying alert can prevent most incidents.

Looking after your customers’ personal information

Customer data deserves special care. This includes contact details, payment information and any data that could identify an individual.

A practical approach is to only collect information you genuinely need and delete it when it is no longer required. Holding onto customer data indefinitely increases your risk without any business benefit.

Access to customer information should be restricted and monitored. If staff work remotely, or use personal devices, clear expectations around security help protect your business and your customers.

Being ready if something goes wrong

Even with sensible protections in place, no system is perfect. Having a basic response plan can make a huge difference if a data breach occurs.

Knowing how to identify a breach, who to contact, and how to communicate with customers helps reduce confusion and damage. A data breach must be reported to the Office of the Australian Information Commissioner (OAIC) and to the individuals affected if personal information is lost, stolen, or disclosed without authorisation and it is likely to cause serious harm to anyone affected.

Moving forward with confidence

Data security does not have to be complicated or expensive. Small, consistent steps can greatly reduce your exposure to risk. Understanding your data, limiting access, maintaining systems and backing up regularly will put you ahead of many businesses your size.

At a time when data breaches regularly make headlines, showing customers that you take their information seriously, can become a real competitive advantage.

i https://www.cyber.gov.au/sites/default/files/2025-10/Annual%20Cyber%20Threat%20Report%202024-25.pdf

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