Australians face fines of up to $1110 if they miss November 1 tax deadline

Tax season stragglers risk fines of up to $1110 if they continue to “bury their heads in the sand” and fail to prepare for the looming deadline.

November 1 is the last day you can enter your 2020-21 tax return without risking a fine from the Australian Taxation Office, with the potential $222 ‘failure to lodge’ penalty growing the longer you dawdle.

But the image of the malevolent tax bogeyman is something the ATO is trying to dispel, with the agency this year hoping to help people realise filing a return isn’t the drama they might perceive it to be.

Australia banknote for savings money concept.Camera IconAustralia banknote and stacks of coin for savings money concept. Generic cash – notes, fifty dollars Credit: Supplied

For one, ATO assistant commissioner Tim Loh said late lodgement fines are usually reserved for those who owe money, and not the 80 per cent of people who end up getting something back. The 80c per hour work from home deduction will be a particular boon for many people this year, he said.

“There’s a four in five chance you’ll be getting a refund anyway, so the odds are better than backing a Melbourne Cup winner,” he said.

“The longer you wait, the chances are you’re missing out on a refund. And if you’re receiving childcare support, CCS or the family tax benefit, you’re required to do it so you get those benefits.”

Those using a registered tax agent usually have until May to make an appointment and get their income and expenses in, meaning a fine is unlikely if they miss November 1.

ATO assistant commissioner Tim Loh says “don’t bury your head in sand, we’re working through it together.”.Camera IconATO assistant commissioner Tim Loh says “don’t bury your head in sand, we’re working through it together.”. Credit: Supplied, Australian Taxation Office.

Additionally, H&R Block director of tax communications Mark Chapman says where a penalty is applied to those doing their own returns, the ATO will sometimes remit it where it is “fair and reasonable to do so”, for example in the event of natural disaster or serious illness.

Mr Loh did say it was still “quite risky” to ignore the deadline and assume a refund was coming, particularly given the complexities of 2020-21 and the coronavirus chaos.

For example, those relying on work-related car use, accommodation, and travel to boost their tax funcold be in for a nasty surprise, with the ATO reportedly cracking down on these claims.

Mr Chapman also said those who need an extra reason to submit their tax return before the 31 October deadline should look no further than the potential $1500 tax back when you lodge.

“The combination of the changes in tax thresholds announced in last year’s budget and the extension of the low-and middle-income tax offset means that if you earn between $48,000 and $90,000, you are probably $,160 better off this year,” he said.

Finance and Wealth - Tax Return FormsCamera Icontax time Australia generic, Australian Taxation Office, ATO Finance and Wealth, Australian Currency and Calculator Credit: Supplied

Ultimately, Mr Loh said the most important thing was for people to get their documents in via the myGov website, even if they were worried about having to pay money.

“The thing to remember is, if you feel like you’ve got a debt, we’re here to help,” he said.

“Once we understand the situation we talk through the options.

“Don’t bury your head in sand, we’re working through it together.”

There have been more than 8.63 million lodgements so far since July 1 – about 20,000 more than the same time last year.

CPA Australia senior manager of tax policy Elinor Kasapidis said those who need more time to complete their tax return should engage a tax agent before November 1.

“Don’t rush through your tax return as this may lead to mistakes,” she said.

“Remember, you can cut your own hair, but you’ll get a better result if you see a professional. It’s the same with completing your tax return.

“If you see a tax agent, you can be confident you’re paying the right amount of tax and getting the maximum refund you’re entitled to.”

News Makanany

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