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How to deal with late or overdue tax returns
Do I need to lodge a tax return if I didn’t earn much income?
Most likely the answer is Yes. Lodging a tax return is mandatory in Australia in most cases. Without your tax return, the ATO cannot conduct assessment for your income tax liabilities. Essentially, by lodging your tax return, you are informing the ATO about your income and other relevant information so the ATO can complete your assessment.If you are in an exemption category in a financial year (e.g. you have nil income and not required to lodge), you still need to update your information with the ATO. It is important to lodge the update before the due date of your tax return to avoid fines.
How much are the penalties or fines for late tax returns?
The ATO is more likely to apply a penalty if:
- you have more than one tax return outstanding
- you have a poor lodgement history, or
- you have not complied with a request to lodge your tax return.
Are there any chance to reduce the penalties?
Yes. In many circumstances, the ATO may reconsider reducing or remitting the penalties and interest charges after you lodged all of your outstanding returns and statements. These circumstances include but not limited to:
- you have refund available from the tax return instead of owing tax
- you have tremendous personal or domestic difficulties beyond your control
- you have severe illness or you were caring for another persona who was sick with a severe illness
- you were stuck with a natural disaster
- other appropriate circumstances that is fair and reasonable
Some of the factors you should consider in deciding whether to apply the FTL penalty are:
- the compliance history of the entity.
- the effort it took to obtain lodgement.
- the value of the information to be disclosed in the taxation document.
- whether the entity is aware of their lodgement obligation and the consequences of not meeting that obligation.
- whether the entity has had an opportunity to comply.
- the length of time the taxation document was overdue.
- any contact the entity or their representative may have had with the ATO prior to the due date for lodgement.
This list is not exhaustive.
At Tax7, we are specialised in this area. We will assist you not only lodging the outstanding tax returns, but also minimising the FTL and GIC charges. We have a proven record of high successful rate. Book an appointment online and speak to one of our highly experienced and friendly staff to help you getting your taxes up to date.
What if I don’t have all my group certificates / PAYG Summaries?
Further, by completing your outstanding tax returns, our accountants may also find your past entitlements for benefits, such as baby bonus, Education Tax Refund, family payment and more. We also offer a convenient no-up-front-fee services to have your fee deducted from your refund.It is important to understand your lodgement obligations and ensure you are up to date with your tax returns. At Tax7, we understand this could be stressful sometimes, this is why we are here. Talk to our friendly team and take the worry away from your tax.