Using smarter data matching, stronger reporting systems and targeted reviews, the ATO is now better placed than ever to spot businesses under-reporting income, over-claiming deductions, missing super obligations, or lodging incorrect BAS statements.

Put simply: if your income, GST, payroll, super or deductions don’t line up with what the ATO expects, you may start receiving questions.

Who’s most at risk?

Any business can be reviewed, but the ATO has flagged closer scrutiny for:

• Property, construction, trades and contractor-based businesses
• Professional services firms
• Businesses with regular cash income
• Businesses with large GST refund claims
• Companies where owners regularly withdraw money
• Employers with inconsistent payroll or super reporting
• Businesses with overdue tax debts or repeated late lodgements
• Businesses with income or margins that don’t match industry norms
  
  

What’s the ATO targeting?

• Under-reported income – Cross-referencing data from banks, payment processors, Single Touch Payroll and third-party platforms means cash, online sales and contractor income are all visible.
• GST and BAS errors – Common issues include claiming GST without a valid tax invoice, reporting sales in the wrong period, or leaving out cash and online sales.
• Super and payroll compliance – Single Touch Payroll gives the ATO real-time visibility over wages and PAYG withholding. From 1 July 2026, Payday Super requires super to be paid alongside wages rather than quarterly — businesses need to start preparing now.
• ATO debt – Since 1 July 2025, ATO interest charges are no longer tax-deductible, making unpaid debt more costly than before.
• Personal expenses through the business – Motor vehicle costs without a logbook, travel, meals, entertainment, home office claims and personal subscriptions are common review areas.
• Division 7A – Money taken out by directors, shareholders or associates needs to be handled correctly, or the ATO may treat it as an unfranked dividend with significant tax consequences.
  
  

What you can do now

• Keep bookkeeping up to date and reconcile accounts regularly
• Separate personal and business spending
• Review your BAS before lodging
• Prepare payroll systems for Payday Super ahead of 1 July 2026
• Review any loans or drawings from your company
• Deal with ATO debt early rather than letting it build up
• Talk to us before major decisions; purchases, restructures, new entities and property transactions all carry tax implications

An ATO review doesn’t always mean a full audit, but it’s far easier to respond with confidence when your records are in order. If any of this sounds familiar, now is a good time to get ahead of it. Please reach out to our team if you’d like to discuss how these changes may affect your business.