Everything you need to know about Overdue Tax Returns
If you have found yourself in the situation of having one or more overdue tax returns, you need to do something about it. We’re not here to judge, but to help break down how much easier and less scary than we’re sure you have made out in your head and spent countless nights laying in bed worrying about the ATO.
It doesn’t matter if you have 20 years of tax returns outstanding, the sooner you do something about it, the better the outcome will be for you and the better chance you have of avoiding ATO penalties and interest. When you’re all caught up – imagine the relief! Our Bunbury Accountants can help you.
How many years do you have outstanding?
First things first, let’s find out what we’re dealing with here. If you don’t know, your tax agent can look this up on their tax agent portal and see exactly how many years are outstanding so you have a starting point to getting up to date with the Australian Tax Office.
Getting your income and expenses information for each year.
Your tax agent can also access ATO pre-filling reports where they can see (alot of the time) all of the information required to prepare your tax returns. Including:
- Group certificates from employers
- Centrelink payment summaries
- Details of private health insurance cover
- Bank interest
- Dividend and other investment income
- Your HELP (HECS) balance for the applicable year
A good tax accountant will also work with you to suggest places that you may be able to find missing records and help you establish any expenses that you could claim for the outstanding years.
Do you even need to lodge a tax return?
Once your tax agent has reviewed the information, they will be able to advise you whether it’s necessary to lodge tax returns for each outstanding year. You must lodge something each year, but in certain circumstances you may be able to lodge a non-lodgement advice with the ATO, such as if you have income below the tax-free threshold. At Ashok Parekh & Co Bunbury, we offer this non-lodgement service free of charge for clients and partners of clients.
Worried about penalties and interest?
Possibly. The sooner you get up-to-date and get your tax affairs in order, the more favourably the ATO will view your case. The ATO can apply a range of sanctions and penalties to force you to lodge or for lodging late. There are a number of reasons why taxpayers lodge late though and our tax accountants can liaise with the ATO on your behalf and put your case forward to apply to have any penalties and interest remitted.
The maximum penalty for an individual is $1050.
Worried about a tax bill?
A good tax agent will work with you to ensure any tax payable is legally minimised, however, in the event that you do have a tax bill the ATO can be very reasonable as long you are communicating with them. At Ashok Parekh & Co Bunbury, we can liaise with the ATO and set up a payment plan for you.
Worried about paying accounting fees?
We can’t speak for other tax agents, but here at Ashok Parekh & co Bunbury we offer a number of different options for clients with overdue tax returns.
Fee from refund
We offer a fee from refund service and if you are receiving a refund, we can deduct our fee from this and deposit your remaining refund balance into your bank account so you pay nothing up front!
Although we are unable to lodge your tax return until payment has been received, we are very flexible with payment arrangements. We can prepare your tax returns, give you an idea of the position you are in and request extensions with the ATO advising them that you are working closely with us to get your overdue tax returns up-to-date. Then as each year’s tax return has been paid for, we can lodge.
Worried about getting audited?
The best thing you can do is use a registered tax agent to prepare your tax returns accurately. They will be able to assist you in the event of an audit and answer any of the ATO’s questions.
Worried about going to jail?
It’s definitely not common, however, the ATO can prosecute taxpayers for overdue tax returns with the maximum penalty being 12 months imprisonment or $8,500.
Worried about anything else?
Just ask! We have a solution for any concern you have. We deal with clients who have overdue tax returns on a weekly basis. Our longest is 18 years outstanding and we can tell you no-one ever regrets taking the first step, contacting us and putting the worry behind them and moving forward.
Book in today for your free consultation on overdue tax returns. At this no pressure appointment you can come in for a coffee and we will find out exactly what position you are in and map you out a plan to get out of it. From there, you can decide what you want to do and when but at least you will leave not feeling so anxious knowing what you need to do. Our staff are really friendly, non-judgmental and genuinely want to help you.