What if my Tax Return is Late?
Do you have late tax returns? Or are you still yet to lodge your 2017 Income Tax Return?
Don’t worry, we’re here to help!
2017 Income Tax Returns:
All Individual Tax Returns for the prior 2016-17 financial year are expected by the Australian Taxation Office (ATO) to be lodged by the 31st October 2017, unless you have lodged with a Registered Tax Agent prior. This means if you still have a 2017 Tax Return you haven’t lodged with the ATO, it may be due sooner than you think. However there is no need to worry. Ezytaxback.com is a Registered Tax Agent and therefore we can still lodge your 2017 returns for you regardless of the time of the year. If you are a user of Ezytaxback.com we are able to lodge your current return up until the 15th May 2018.
If your 2017 Tax Return results in a tax payable there is a small chance you may incur a fine for a late tax return from the ATO if you miss the due date, however, the ATO will send you warnings before this penalty is administered. If your late tax return results in a refund you most likely won’t incur a penalty as the ATO views this as a low-risk document. However as a general rule, the longer you wait to lodge this return the higher the chance of receiving a late tax return fine.
What happens if you file your taxes late?
If you have prior year outstanding tax returns you need to lodge these as soon as you can in order to avoid penalties. If you are filing taxes late and have received a penalty, penalty determination depends on your individual circumstances, lodgement history and how much money you may owe the ATO, so it’s best to get on top of these matters fast.
If your outstanding returns result in a refund or a nil result (no refund or payable) you shouldn’t incur a fine for a late tax return as you’re once again considered by the ATO as low risk. If you have a tax payable in these circumstances you could incur a Failure to Lodge on Time Penalty (FTL Penalty). The higher the amount of tax payable owed, the higher risk you’re considered to be by the ATO resulting in a higher chance of penalty. In some rare cases you may incur interest on the amount owed between lodgement due date and the date the amount was paid however this can usually be avoided, offset or remitted in individual circumstances.
Ezytaxback.com’s online software only allows you to complete returns dating back to 2013. If you have a return you require to be completed that is prior to 2013, we can still help you with paying your taxes late. Just send our Customer Care team an email with all your information attached and the relevant year you would like a return completed for. We will respond with our bank details so you can complete the $29.95 payment and we will complete the late tax return for you.
What if I have lost my information?
If you have late tax returns to file and you can’t find your information, you’re in the right hands. Ezytaxback.com has access to your Tax Information already lodged through government agencies with the ATO. This allows us to retrieve missing income details such as PAYG summaries, dividends or bank interest. In some circumstances the ATO may not have your information, and in these cases we will discuss with you via email your options so we can move forward and complete your return.
When filing tax returns late with ezytaxback.com, select the year you’re completing a return for and enter all the information you have. Once you have completed your return, email our Customer Care team at firstname.lastname@example.org and let us know you’re missing records. We will obtain the information we can and let you know if anything further is missing. Once you’re happy with your return we will lodge it with the ATO for you. It’s that simple.
Owing the ATO money:
Owing the ATO money can be a scary thought and may be the main reason why you may not have lodged your current or late tax returns but the sooner you sort out your tax affairs the better and easier this process will be.
The best course of action is to get all your late tax returns lodged so you’re up to date and may avoid a fine for a late tax return. Once the ATO has processed your returns you will be issued with a Notice of Assessment outlining how much you owe and your payment options. If you’re unable to pay the outstanding amount in full you can negotiate a payment plan that suits your needs with the ATO.
When negotiating a payment plan you can use the Payment Arrangement Calculator on the ATO website as a guide. It is important to be honest about your circumstances and the ATO are almost always willing to work with you to come to an agreement that suits both parties. The downside to a Payment Arrangement is that you will most likely incur a General Interest Charge (GIC) on the outstanding amount until it is paid in full however this can be discussed when negotiating with the ATO.
With Tax Season in full swing it is important to remember the little things that might have a huge effect on the result of your Tax Return. To help you get into gear here are some simple tips on how to reduce tax mistakes and how to get a higher tax return:
Have a deduction strategy
The best way to increase the value of your tax return is through deductions. It may seem like an obvious solution, yet more than 45 per cent of young Australians age between 25 and 34 failed to claim further than the $300 threshold for their tax returns the previous year.
To ensure dollars end up back in your pocket and to reduce the possibility of making tax deduction mistakes, it’s worth spending some time getting to know the items you can and cannot claim for your particular industry or occupation and subsequently creating a tax deduction strategy. For instance, flight attendants are able to claim rehydrating moisturisers and hair conditioner in order to meet strict grooming requirements. Similarly, police officers required to maintain a high level of fitness for their position can claim gym membership and the cost of traveling directly from the workplace to the location of exercise.
Currently individuals can claim $300 without receipts, however, once this value is exceeded you must be able to produce receipts for all expenses. So take advantage of tax-time and keep a tight lid on your shoebox of receipts to ensure an efficient tax deduction strategy and to maximise your refund.
Avoid simple tax mistakes
The tax system is complex in nature and making a mistake can be detrimental to your hip pocket. The most common mistake is overlooking the amount earnt from your financial institution account. This is called interest income and it must be declared when lodging your tax.
The ATO is currently focused on taxpayers claiming depreciation on rental properties. It is vital for individuals to understand the difference between repairs and additions to rental properties. What underlines a repair is the intent to restore the property to a condition it was previously in, without changing its character. Repairs are considered an expense and can be claimed against rental income, whereas additions take the form of capital. However, repairs that take place shortly after the property is acquired are considered to be costs associated with acquiring the property and are therefore a capital expense and not deduction.
Keep your employer informed
If you have a HECS/HELP debt and earn more than $55,874 from July 01, 2017, it is compulsory to repay the loan even if you are still studying. Your employer can withhold additional amounts from your wage to cover the required repayments. Otherwise, you will need to pay back money as part of your tax return.
You can also apply to have less tax taken from your wage if you have an investment property with a mortgage. Instead of collecting negative gearing benefits at tax time you’ll be able to enjoy a little extra throughout the year.
Instant $20,000 write-off
For small businesses cash flow is a priority. Last year small businesses were able to purchase assets up to the value of $20,000 and receive an immediate deduction for the full value rather than having to write it down over the following years.
From July 1 this year, the federal government is extending this tax deduction strategy to businesses turning over up to $10 million. Get in quick to claim your tax savings because the policy is limited until June 30, 2018.
Use a registered tax agent
It’s important to keep-up-date with your tax. Filing an individual claim with a registered tax agent or accountant like Ezytaxback.com, will help prevent tax mistakes. You’ll also get expert advice and avoid potential penalties in the event of an audit. The team of qualified accountants will also review your return and can provide you with a tax deduction strategy to show you how to get a high tax return and ensure there are no tax deductions you are missing out on before it reaches the ATO.