Some small business owners in Darwin are still struggling financially and emotionally to bounce back from the impact of COVID, despite election campaign claims that the Australian economy is in good shape, according to Chartered Accountants Australia and New Zealand.
CA ANZ held its Annual NT Forum in Darwin on Wednesday and the organisation’s Tax Leader Michael Croker said NT members had revealed not all small business clients were travelling well – with some facing insolvency.
“Despite all the Federal election talk about how well the Australian economy has performed, there are some local businesses where business restructuring or even insolvency is also on the agenda in discussions with accountants,” Mr Croker said.
“It’s not just about the dollars. Some small business operators are suffering from stress and need support from their accountant, other service providers like Beyond Blue and most importantly, family and friends.
“Most people think of COVID when the topic of healthy workplaces comes up, but within the Territory’s CA community, there is also great concern for the well-being of some small business clients still struggling to emerge from COVID.”
The ATO’s return to “business as usual” tax debt collection and meeting post COVID business finance and commercial rent obligations are the focus of many client conversations at the moment, Darwin members reported.
Mr Croker said: “Managing cashflow and outlays is as important as ever.”
He added that the accounting bodies had invested heavily in providing resources to help their members better assist clients experiencing mental health issues.
Mr Croker said Territory accountants were also gearing up for another busy tax return season come 30 June.
“Work from home deductions, claims for face masks and rapid antigen test kits will be a big focus this year. The ATO says it will also be out and about on crypto currency, acknowledging that many Australians have been on a roller-coaster of gains and losses during this financial year.”
Mr Croker said Territory accountants see a range of unusual attempts at deduction claims every year. Attendees at this year’s Forum gave a few examples:
A new 12-metre swimming pool claimed as emergency water storage
A proportion of the cost of home groceries “because its expensive to live in the Territory”
Post COVID lockdown family reunion flights claimed as business trips
Mr Croker urged Territorians to start getting their tax records ready.
"The income tax law contains substantiation rules which the ATO can call for if a deduction claim looks suspicious. Honesty is the best policy when dealing with both your accountant and the ATO.”