Unless you’re an accountant like us, then chancesare you probably find completing your annual income tax return a boring, or
plain annoying, chore. For some, lodging their tax return is so daunting they’d
rather avoid it with any excuse possible. For example, HMRC in 2021 cited
excuses from pets eating their tax forms to alien invasions (Seriously, read about it here).
While sometimes late lodgments can be amusing, forthe most part, there are serious consequences for lodging your tax return late
– or simply not at all.
Do I reallyneed to lodge a tax return though?
If you earn more than $18,200 a year, then the shortanswer is – yes! If you earn less than the threshold though, you may still need to lodge it – If you fall belowthis threshold and are unsure, Auditax Accountants can help you determine
whether you’re required to lodge.
What if Idon’t lodge a tax return?
Well, you may be in for a fun time then. If you failto lodge your income tax return by the yearly cut-off date (casual reminder,
for 2022 it is October 31st), then the ATO will issue you a Failureto Lodge penalty (FTL). This fine is recalculated every 28 days after the
deadline at a unit price of $222.
If after a period of time has passed and you aresomehow not phased or simply indifferent to the fines added to your account,
the ATO can then issue you with a default assessment. This is basically an
estimated assessment of your income, based on data held by the ATO. As this is
an estimate, chances are it will be incorrect and you will be changed a higher
tax liability than what you actually owe.
In the most extreme of cases, the ATO may prosecuteyou for failing to lodge your tax return. The maximum penalty which can be
applied on prosecution is currently $9,000, or imprisonment for up to 12
months.
Prison asides, that doesn’t sound too bad. Can’t I just argue my wayout of the fines?
You are able to dispute your fines or defaultassessments. However, you must demonstrate what your actual tax liability is,
and remain compliant in paying off your debts and lodging your tax return. In
most cases, simply arguing isn’t enough – you should do your tax return.
So, confession… I haven’t lodged my tax return yet. What should I donow?
Luckily, the cut off for this year’s income taxreturns is October 31st, so you have plenty of time. You can lodgeyour tax return yourself by logging into your MyGov account and using the myTax links. However, if you have taxreturns that are outstanding, the ATO will catch up with you.
If you have the means to do so, then get your taxreturns up to date ASAP. If you are in need of assistance, Auditax Accountants
can assist, and make the catch-up process as smooth as possible.
Of course! Auditax Accountants can help you minimise the risk by lodging a ato overdue tax return fine on your behalf, or help you with your current tax return. Just call (08) 9358 5599 or e-mail hello@auditax.com.au to make an appointment.
