Substituted Accounting Period (SAP) and Audit Relief Services in Australia
We offer Substituted Accounting Period (SAP) and Audit Relief services to businesses in Australia seeking to apply for a SAP and/or qualify for audit relief. With over ten years of solid experience, our accountants and tax advisory consultants have assisted companies of varied sizes in successfully adopting a SAP and/or obtaining relief from submitting audit requirements.
Understanding tax laws in Australia can be complicated, especially if you don’t have the right resources to make informed decisions. Resubmitting documents due to errors or incorrect/incomplete information is costly, money-wise and time-wise. The best way to avoid this is to ensure you have the right guidance and tools when lodging your application.
Our Substituted Accounting Period (SAP) and Audit Relief Services
Substituted Accounting Period
A Substituted Accounting Period (SAP) is a financial year different from the standard annual accounting period of 1 July to 30 June in Australia. It allows eligible companies to have an alternative “end of financial year” if the standard period (1 July – 30 June) doesn’t allow them to calculate their taxable income by the deadline. Or if it doesn’t coincide with the financial year of their foreign parent company.
Essentially, a SAP allows you to have a financial year on any other twelve-month period besides 1 July – 30 June (e.g., 1 April to 31 March or 1 January to 31 December).
To apply for a SAP, you must fill out the application form NAT 5087 (Application for a Substituted Accounting Period) with true and correct information. Submit your application at least 28 days before the earlier of either: the due date for lodgment of the income tax return for the current accounting period. Applications submitted after the preferred accounting period has lapsed will cause complications and are thus subject to rejection.
In your application form, you must indicate the reason why you want to apply for a SAP. To ensure your application gets approved, you should provide supporting information to substantiate your reason for applying. If you’re not sure what supporting information you need to submit, we are ready to help.
Once all required details are provided, the application form must then be signed by an authorised person, which could be any of the following:
- registered tax agent
- public officer
- partner (for partnerships)
- if an individual, the trustee; if a trustee company, the public officer (for trusts)
If you don’t have an authorised person to sign the application form on your behalf, you can reach out to us for assistance.
Taxpayers allowed to adopt a SAP must lodge tax returns on the following due dates prescribed by ATO:
|Type of Entity
|Individuals, Partnerships, and Trusts
|Last day of the fourth month after the close of the accounting period
|Companies and Super Funds (excluding Not Full Self-Assessment (NFSA) taxpayers)
|First day of the sixth month after the close of the accounting period
|Companies and Super Funds (excluding NFSA taxpayers)
|15th day of the seventh month after the close of the accounting period
Audit relief is an exemption from fulfilling audit requirements for your business in Australia. Companies granted audit relief no longer have to fulfil the following reporting obligations:
- appoint an auditor
- ensure financial reports are audited
- lodge an auditor’s report with ASIC
- present an auditor’s report to the shareholders
- present a statement by the auditor about any concise financial report
- the consolidated gross revenue for the financial year of the company and any entities it controls is less than $25 million
- the value of the consolidated gross assets at the end of the financial year of the company and any entities it controls is $12.5 million or less
- the company and any entities it controls have less than 50 employees at the end of the financial year
To apply for audit relief in Australia, you need to lodge ASIC Form 382 (Notification of Resolutions for Audit Relief – Proprietary Companies) within the application period set by ASIC.
For ASIC to consider your application, the following conditions must be met:
- the company directors and shareholders must have passed unanimous resolutions stating that an audit is not required (notice of these resolutions must have been lodged with ASIC)
- the company is well-managed, in sound financial condition (with at least a system of quarterly management accounting in place)
- the company’s financial reports are prepared by a prescribed accountant
- the company’s financial reports and directors’ reports are lodged ahead of deadlines
- there is no proposed modified auditor’s report or material disagreement with any auditor
Those that do not meet all the conditions above can apply instead for individual audit relief, which we can help you with.
Process Your Substituted Accounting Period (SAP) and Audit Relief Applications With Ease
The Australian government provides readily-available resources online to corporate entities for lodging applications and processing compliance obligations. But even with these resources present, errors and incorrect/incomplete submissions are still inevitable — putting your effort and time to waste. To ensure you are maximising the government benefits available to your company, we at Company Set Up Australia are here to help you.