Taxpayers face penalties for undeclared income
Adrian Raftery
The Australian TaxationOffice (ATO) has provided incomplete information in the ATO’s new e-tax pre-filling service, which could cause taxpayers to understate their income, leading to penalties at a later date, said Adrian Raftery, the chief executive of accountantsRus.
The new pre-filling service was an initiative by the ATO to partially complete taxpayers’ tax returns for wages, interest and dividends by using information provided by their employers, banks, and share registries.
However, many banks, employers and share registries had been slow to provide information to the ATO, leading to some taxpayers lodging tax returns with income that was accidentally omitted.
“We are six weeks into the financial year, yet a lot of banks and share registries are yet to report information to the ATO, which means that some [taxpayers] have not included all income in their returns,” Raftery said.
“The result is that they may have understated their interest and dividend income and the ATO may impose penalties at a later date, which I suppose is a bit harsh.
“My old man always told me to ‘measure twice and cut once’ … don’t be caught out thinking that the ATO has all your income information correct — they don’t,” Raftery said.
Recommended for you
Financial Services Minister Stephen Jones has shared further details on the second tranche of the Delivering Better Financial Outcomes reforms including modernising best interests duty and reforming Statements of Advice.
The Federal Court has found a company director guilty of operating unregistered managed investment schemes and carrying on a financial services business without holding an AFSL.
The Governance Institute has said ASIC’s governance arrangements are no longer “fit for purpose” in a time when financial markets are quickly innovating and cyber crime becomes a threat.
Compliance professionals working in financial services are facing burnout risk as higher workloads, coupled with the ever-changing regulation, place notable strain on staff.
