In response to COVID-19, the Australian taxation office (ATO) extended the lodgment day for 2018–19 company tax returns for many companies:
- Returns that were due on 15 May 2020 under the tax agent lodgment program have been automatically extended to 5 June 2020.
- Companies may have received a later lodgment due date in response to direct requests for lodgement deferrals.
To avoid Division 7A consequences for certain recipients of payments or loans made by the company during the 2018–19 income year, a company must take the following actions before the deferred lodgment day (or the actual date of lodgment of their 2018–19 income tax return, if earlier):
- Repay in full, or place on terms that comply with section 109N, a loan made by the company during that income year.
- Convert a payment made by the company during that income year to a loan on terms that comply with section 109N.
If taxpayers place a loan on section 109N terms before the deferred lodgment date, the borrower will need to make their first minimum yearly repayment (MYR) by 30 June 2020. The Commissioner will soon be issuing further guidance for those affected by COVID-19 with MYRs due for the year ended 30 June 2020.
