Think you’ve made a mistake on your tax return or forgotten to include something?
Don’t worry; it’s easy to fix up an already lodged tax return by lodging what’s called an amended tax return.
How do I lodge an amended tax return?
Etax Accountants or any other tax agent is able to lodge an amended tax return up to two years from the original date of lodgement. If you’ve made an error on a tax return you’ve already lodged, let us know as soon as possible and we can help you get started.
Call us on 1300 693 829 or email the team on [email protected]. Alternatively, send your accountant a secure message while logged into your Etax Account.
Why should I lodge an amended tax return?
Let’s take a look at some of the reasons why you might need to amend your tax return:
- You’ve forgotten to include some income.
- The income you have included is incorrect.
- You’ve forgotten to include deductions.
- You’ve claimed more deductions than you’re eligible to claim based on your circumstances.
The above four scenarios are remarkably common and depending on the exact change you need to make to your return, an amended tax return might even see you increase your refund.
Regardless though, if you’ve lodged an incorrect tax return, either intentional or not you should fix it up ASAP.
Here’s why:
The ATO isn’t silly when it comes to finding errors on your tax return. They use sophisticated data matching programs to ensure the income you enter and the deductions you claim are accurate and allowable.
And, while more often than not taking the initiative to lodge an amended tax return yourself means you’re unlikely to face an ATO penalty, if you wait for the ATO to spot your mistake you could find yourself with a costly bill and penalty even if your mistake was unintentional.
Don’t think just because the ATO hasn’t caught you for an incorrect return you lodged a year or two ago that you’re in the clear. We’ve seen clients receive fines for returns that were incorrectly lodged two or three years ago.
Isn’t it better to clear up and fix and incorrect tax return now, rather than run the risk of an ATO fine?
Case Study – Claiming deductions you’re not entitled too.
This is a pretty big no-no for the ATO, and they’re able to find you with ease:
Example:
Andrew works for a big construction company. He claimed deductions for a range of work-related expenses, such as a mobile phone, meal costs, travel, accommodation and training courses.
Andrew got a nice, hefty tax refund – $3800!
The truth is, his employer paid for all of those expenses. Andrew didn’t pay directly for most of them, and was reimbursed for the ones he did pay for. Consequently, he’s not eligible to claim a tax deduction for them.
The ATO discovered that Andrew’s employer paid for almost every expense as the employer claimed those expenses on their own tax returns! Andrew received an amended Notice of Assessment for his tax return. It requested that he repay $3000 of his refund, plus interest.
On top of that the ATO issued Andrew a $560 penalty for failing to take reasonable care on his tax return.
Andrew then got another amended Notice of Assessment from the year before. Why? Well, the ATO now knows that Andrew was dishonest about his last tax return, so they checked his previous returns. So, once again, he is asked to repay another overpayment of $2900. Plus, another $560 penalty!
All up Andrew now has to pay the ATO over $7,000! That hurts.
The repercussions of incorrectly claiming tax deductions can be harsh. By lodging a tax return amendment, you can often resolve the issue prior to the ATO issuing a fine.
We’re available to talk to you if you’re worried about an issue with your tax return.
Get in touch with us on [email protected] or 1300 693 829 and we can assess whether an amended tax return is needed based on your personal circumstances.
