ATO Penalties Increase

From 31 July 2015, Commonwealth penalty units will increase from $170 to $180.  “So what” you say, “I can live with $180”.  It’s not as easy at that.

Penalty for failing to lodge (FTL) a document on time
When you must lodge a document and fail to lodge that document by the due date, you are liable for a penalty. The penalty applies for each 28-day period, or part thereof, that the statement remains unlodged – to a maximum of 5 periods.  So if you are 113 days or more late then the charge is $900 for that document alone.  If you have a few BAS returns unlodged they could be $900 each.

Interest too
Interest charges apply to unpaid amounts, such as shortfall amounts, late payments and tax debts. Interest charges apply whether or not a penalty applies.

What documents attract a penalty?
The penalty system automatically applies FTL penalty to late-lodged documents, including:

  • activity statements
  • income tax returns
  • FBT returns
  • PAYG withholding annual reports and
  • annual GST returns.

What if I am due to receive a refund?
As a rule, a penalty will not be applied to a late-lodged income tax return, annual GST tax return or activity statement, where the lodgement results in either:

  • a refund
  • a nil result – that is, neither a debt nor a refund.

However, if the FTL penalty has been applied before the document is lodged, the penalty will not be remitted even if the subsequent lodgement of the document results in a refund or nil result.

So, are you feeling guilty?  Well rather than be guilty and poor, why not face up to the problem, dig out all your tax papers and come and see us?

Give Noel or Amanda a ring on (03) 9585 7555 oremail us.
We can get you ‘in the good books’ again.

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