Farm Weekly | The ATO, AML and AI all walk into a farm… and no one’s laughing!
Ryan Naughton | Director
It might sound like the setup to a bad joke, but for many farmers and regional business owners, it’s becoming a reality!
Fuel’s up, fert’s up, the cost of machinery is up, interest rates are up, labour costs are up, housing costs are up, accounting fees are up (delete that last one before this goes to print!).
No, you are not imagining things, the cost of doing business is definitely on the rise. And just when you thought there couldn’t possibly be another challenge to deal with, along comes a fresh wave of tax, technology and compliance obligations.
While most business owners are focused on the important things like growing crops, managing livestock, finding staff and keeping an eye on cashflow, advisers are increasingly finding themselves helping clients navigate a wave of new rules, reviews and reporting requirements.
Some of the issues already on the radar include:
New Anti-Money Laundering (AML) requirements extending to accounting practices and other professional service providers.
Increased ATO scrutiny of trust distributions, section 100A and family trust election arrangements.
Ongoing reviews of Division 7A loans and private company structures.
Greater use of ATO data matching technology to identify compliance risks.
Payroll, contractor and superannuation compliance reviews.
Cybersecurity and data protection obligations.
The growing use of artificial intelligence and the governance challenges it creates.
Succession planning and intergenerational transfer of family businesses.
Proposed budget changes affecting discretionary trusts.
Proposed capital gains tax and investment-related reforms that could significantly influence future business and investment decisions.
Greater compliance obligations when employing staff (STP and Same Day Super).
Rising WorkCover and workplace compliance obligations.
SMSF and additional Div 296 taxes.
For farming enterprises in particular, these developments come at a time when many families are already considering long-term ownership structures and succession arrangements. Decisions that may have been deferred in the past are increasingly becoming priorities.
The reality is that compliance is becoming more complex, not less. Like preventative maintenance on a header, ute or air seeder, business structures also need regular servicing. The cheapest time to fix a problem is usually before it becomes one.
The businesses that will be best placed for the future won't necessarily be the biggest or the most profitable. They'll be the ones that stay informed, adapt early and tackle issues before they're forced to.
Waiting until a regulatory change becomes law or an ATO review commences is rarely the best strategy.
If you're waiting for compliance obligations to start heading south, don't hold your breath. They seem to be arriving almost as regularly as the next fuel bill.
At Byfields, we help you stay ahead of change with practical advice and proactive planning—contact our team to discuss how we can help protect and strengthen your business for the future. www.byfields.com.au