Late Tax Returns! What Happens If You Don’t Lodge a Tax Return On Time – Or Ever?

 

Unless you’re an accountant like us, then chances are 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, for the most part, there are serious consequences for lodging your tax return late – or simply not at all.

Do I really need to lodge a tax return though?


If you earn more than $18,200 a year, then the short answer is – yes! If you earn less than the threshold though, you may still need to lodge it – If you fall below this threshold and are unsure, Auditax Accountants can help you determine whether you’re required to lodge.

What if I don’t lodge a tax return?


Well, you may be in for a fun time then. If you fail to 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 Failure to 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 are somehow 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 prosecute you 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 way out of the fines?


You are able to dispute your fines or default assessments. 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 do now?


Luckily, the cut off for this year’s income tax returns is October 31st, so you have plenty of time. You can lodge your tax return yourself by logging into your MyGov account and using the myTax links. However, if you have tax returns that are outstanding, the ATO will catch up with you.

If you have the means to do so, then get your tax returns 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 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.

Comments

Post a Comment

Popular posts from this blog

four small business accounting recommendations for startup agencies

Image
    You begin maintaining song of each the quantity of energy you eat and the number of kilograms you weigh whilst you first make the selection to lose weight. When you deliver your new child domestic for the primary time, you probable take cautious observe in their top and weight and examine them in terms of the norms for his or her age group. Your new small business isn't always an exception. Establishing a brand new organisation is a hard and essential endeavor. You can be in ownership of a tremendous idea or a modern method ; nonetheless,   in case your startup is unsuccessful in getting off the ground, it's far not going that you may be in small business for extremely lengthy . The reality of the problem is that your desires in phrases of accounting are going to be very special from the ones of a longtime organisation , a retailer, or a large corporation with an annual turnover withinside the seven-digit parent ra...
Read more

How to know if accounting is right for you?

Image
 The small business environment in Australia is quite dynamic. Cloud technology, which is rapidly expanding, continues to have an impact on how organisations engage with their consumers. To guarantee that they are maximising their potential, business owners should surround themselves with innovative and forward-thinking accounting specialists. A smart tax accountant will do more than just figure out how much tax you owe for the year; they'll keep their finger on the pulse and function as a sounding board for all company choices, such as recruiting new employees, acquiring equipment, or signing a new lease. A good accountant is a priceless asset. Here are some pointers to help you select the best accountant for your company. Your accountant must be aware of your requirements. Consider what services you want handled before you start looking for an accountant. You might require someone to handle your bookkeeping, payroll, BAS filing, income tax returns, cash flow, budgeting, or ev...
Read more

What are the reasons to use an accounting software

Image
  If you run a business and you are a business owner, Business accounting is one of the duties you are required to perform on a daily basis. It can be an extremely difficult task when it's completed by hand. In this instance, an accounting program is able to help. Software for accounting can benefit companies immensely, from writing invoices for customers to providing precise tax reports Accounting software can complete the task. All over the world. There are lots of people around the world who have benefitted from  accounting software . The range in computerised financial accounting has grown since the cost has decreased and software has become user-friendly, even for those who do not know anything about accounting. Software for accounting can provide you with numerous advantages. Will Save Your Time The most crucial aspect of business, especially when you're just beginning your journey. Accounting software has made it easier to manag...
Read more