The Australian Tax Office has issued a warning to tax payers not to try to make false claims or ignore collection communication. The result will be forceful follow-up and audit action.

Dodgy claims:

It feels as though the ATO issues the same warning each year: don’t claim unrelated expenses! And yet, some people are still attempting to write-off items such as doggy day care, slippers and biscuits. Additionally, Aussies are failing to declare their side-hustle income, such as cryptocurrency.

There is a guide available to check what items and services you are eligible to claim, and take our word for it, it pays to check. The ATO has a lot of catching up to do in terms of collection, and a dodgy claim will attract unwanted attention and result in an audit. Audits are expensive and time consuming as you need your accountants support, and potentially legal advice. That being said, a routine audit can be sprung on anyone at anytime. Audit insurance is a cost-effective option to protect yourself from unwanted fees if one an audit is sprung on you. Ask us for more information about your tax return and audit insurance.

Tax debt:

When it comes to tax obligations and deadlines, the ATO believes their communication to be clear and their response times to be fair. It is when SMEs fail to respond that the ATO will crack down.

After a period of leniency during the peak of the pandemic, SMEs with one or more prior-year tax returns overdue at 30 June had a deadline of 31 October for their current year tax return. This would be extended to normal lodgement dates if all overdue prior-year tax returns were lodged by the end of October.

The ATO wants SMEs and individual tax payers to know that ignoring their communication is the worst thing to do. If tax obligations seem impossible, the best thing to do is to communicate openly with them and partner to resolve the issue. SMEs may be eligible for programs such as a lodgment program deferral or additional assistance via the supported lodgment program.

Lodgement deferrals are available for tax returns, fringe benefit tax returns, monthly and quarterly activity statements as well as annual GST, PAYG and taxable payment reports. We represent many SMEs in this process, dealing directly with the ATO on their behalf. We also take a diagnostic and holistic approach to the tax structure, aiming to find efficiencies to prevent the same issue in the future. SMEs can save thousands. Ask us for more information about your tax structure or join our complimentary business workshop on Wednesday 3 August to explore financial structures that will save you time and money in your business. Register here.