The Australian Taxation Office (ATO) is closing in fast on everyone who doesn’t properly declare their income and pay the correct amount of tax.
At Total Accounting Partners, we want to help you be aware of what the ATO is doing and how you can protect yourself.
HOW DOES THE ATO KNOW?
The ATO is linking databases of property sales, car purchases, international plane flights, dividends paid from shares, and sales of shares and investments with the income declared on your Tax Return.
If your Taxable Income doesn’t match with your spending or repayment of loans, then the ATO will probably “red flag” you for a tax audit.
These databases have not been linked before like this, so we are expecting to see a huge increase in the number of tax audits over the next 12 months.
BUSINESS CASH RECEIPTS NOT DECLARED
Many small business owners pocket some of their cash takings each week and don’t declare this in their Tax Returns.
The ATO now has the tools to catch this out.
When your business Tax Return is lodged, the ATO compares your profit and other key indicators as a % of your total sales with other businesses in your industry. If your profit % is lower than average, then the ATO may decide to do a tax audit just to see if you’re properly declaring all the income you actually receive, or if the expenses you’ve claimed are actually allowable as tax deductions. Also, not declaring cash income from your business could result in you getting a much smaller price for the sale of your business.
WHAT ARE WE DOING TO HELP YOU?
We have 2 keys roles as your tax accountants.
- Ensure you pay the least amount of tax you legally should.
- Assist you to lodge a correct tax return, so if you’re audited by the ATO you can sleep peacefully at night knowing that you’ve done the right thing.
While we don’t like paying tax just as much as you – at the end of the day it simply is a normal part of life and there’s nothing we can do about it except for obeying the laws and lodging a true and correct Tax Return.
IF THE ATO DECIDES TO AUDIT YOU
If you don’t declare all income you receive and claim expenses that aren’t allowable tax deductions, you will have to pay back tax PLUS pay large penalties and interest to the ATO.
Is this really worth it?
WE’RE ON YOUR SIDE. TALK TO US TODAY!
We’re on your side and want to help you!
Contact your expert team at Total Accounting Partners today on 07 5493 2111 or by email at firstname.lastname@example.org.