The ATO is warning taxpayers they risk any tax refund being delayed or having their return adjusted if they lodge a tax return before their income statement is marked as ‘tax ready’.
ATO assistant commissioner Tim Loh said the ATO saw more mistakes in early July as people rushed to get their tax returns done.
“You can lodge on July 1, but you are punting with your tax return by risking delays to any refund you are owed,” he said.
“If you forget to include everything, you may end up answering questions from the tax office.
“We pre-fill some of the information in your tax return to help you to get it right the first time. We pre-fill information such as your wages, health insurance and interest from banks. This process is usually finalised by late July.
“Thanks to pre-fill, waiting a few extra weeks can make lodging your tax return online quicker and easier.”
The ATO said last July, more than 140,000 taxpayers had their 2020–21 tax return amended before the ATO issued their tax assessments.
“The stakes are high for early July lodgers. People who lodge in July are twice as likely to have their returns adjusted by the ATO,” Mr Loh said.
Each year from late July onwards, most information from employers, banks, government agencies and health funds will be automatically loaded into tax returns.
To check if pre-filled information is available and confirm if income statements are ‘tax ready’, you can visit the ATO app or log in to ATO online services through myGov.
Meanwhile, the ATO also has some timely help for small business owners.
It has released a tax time toolkit to help small businesses and their tax professionals with income tax returns.
It has also flagged what it will be focusing on for small business tax returns for 2021–22.
That includes deductions that are private in nature and not related to business income; over claiming of business expenses (especially for taxpayers running a home-based business); and omission of business income, such as income from the sharing economy or new business ventures (including insufficient or non-existent record keeping).
The ATO’s small business tax time toolkit includes guides on home-based business expenses; motor vehicle expenses; travel expenses; claiming deductions for the cost of digital expenses; using business money and assets for personal use; and pausing or permanently closing your business.
ATO assistant commissioner Andrew Watson said if tax obligations were proving difficult, a registered tax professional could be a great help.
“We know most small businesses do their best to meet their tax obligations and get it right,” he said.
“We know it’s been a tough couple of years for many small business owners, and we understand your tax obligations may not be at the top of your list, so if you need a hand, I encourage you to contact your registered tax professional or the ATO.
“If you’re feeling overwhelmed or getting behind with your tax, let us know as early as possible so we can work with you to find a solution. No matter what your situation is, it’s never too late to ask for help.
“Tax time is also a great time to discuss ATO debts with your registered tax professional or the ATO and set up a payment plan if you need one.”
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