ATO’s crackdown on the restaurant, café and takeaway industry

Over the next three years, the Tax Office will review restaurant, café and takeaway businesses via various methods, including:

• Looking for lifestyle and spending habits that outweigh business income;
• Comparing businesses against the small business benchmarks;
• Reviewing third party information such as bank transactions and comparing it to what businesses have reported; and
• Investigating information provided by employees and the community

If a mistake has been made regarding the disclosure of business income or expense, remedy actions must be taken immediately by making a voluntary disclosure or contacting a tax advisor for assistance.

Hefty penalties may be imposed if a business is found not to comply with the Tax Office reporting requirements.

For more information, click here.

How to recognise employee entitlements in relation to a public holiday

The recognition of employee entitlements in relation to a public holiday may differ across businesses due to the difference between state or territory laws, and the difference between various awards and enterprise agreements.

Certain dates in a year are recognised as public holidays by the National Employment Standards, which apply across Australia. However, different laws across States and Territories also recognise additional days as public holidays.
Generally, employees are entitled to penalty rates for working on a public holiday. However, some awards and agreements may provide that employees can:

• Substitute the public holiday for a different day;
• Accumulate an additional day of annual leave; or
• Get time off in lieu

Employees can refuse to work on a public holiday if their refusal is reasonable, after considering various factors including the employee’s personal circumstances, the needs of the workplace, and how much notice the employee was given about working.

If full time and part-time employees choose not to work on a public holiday, they should be paid their base rate of pay for their ordinary hours.
Casual employees do not get paid for public holidays, unless they actually work on the day.

An employee’s roster cannot be changed to avoid paying their entitlements for a public holiday.

If an employee is on annual or personal leave when a public holiday falls, the day is treated as a public holiday and should not be taken off the employee’s annual leave or personal leave balance.

For more information, click here.

Employees and Workplace Giving and Salary Sacrifice

There are 3 methods an employer can use to record donations made by an employee that the employer pays directly on their behalf.

1. After Tax Donation. This way the gross/net pay is calculated as usual with the tax amount; the donation is made from the net pay. The donated amount appears on the payment summary at the end of the year. The employee can then claim this donation against their taxable income in their tax return.
    
2. Salary Sacrifice. This way the employee can “sacrifice” the wage to the charity, and pay no tax on the sacrificed amount. This is reported the same as super salary sacrifice, and reduces gross payments accordingly. This however does not get reported on the payment summary, and the employee cannot claim the amounts donated against their tax return.
    
3. Workplace Giving Scheme. An employer may offer a workplace giving program where a donation to a DGR is deducted from the employee’s wages and paid directly to the DGR on behalf of the employee. This is an optional program and is an ATO approved scheme where the tax is calculated differently - essentially the employee gets a slightly reduced tax rate for donating some of their after tax income to a charity. The donated amount appears on the payment summary at the end of the year. The employee can then claim this donation against their taxable income in their tax return. There are specific guidelines and tax calculations for setting up a workplace giving program.

In all cases, the employee still gets the Super Guarantee paid on the gross wage. Also in all cases, for the employer to pay directly to the charity it must be a registered Deductible Gift Recipient.

If the employee wishes to donate to an entity other than a registered DGR, they must do this themselves, the employer cannot get involved. It is up to the employer to check the status of the charity and confirm that they are DGR before paying them. Check the charity’s ABN to verify their status.

There is no limit to how much of their wage an employee can donate. If they choose, they can donate their entire wage