If you earn more than the tax-free threshold which currently sits at $18,200, you are required by the ATO to lodge an individual tax return. In few cases you may be required to lodge a return under the threshold – contact us if you need help figuring this out.
Tax returns are lodged every year – sometimes life does get in the way, you may be overseas, busy, haven’t got around to it – we highly recommend getting up to date! The ATO can apply several sanctions and penalties for lodging late.
What are the Sanctions?
Failure to lodge (FTL) on time penalty may be applied if you’re required to lodge a return, report or statement (or both) by a certain day, but don’t. If you have not lodged, the ATO will warn you via phone or in writing before they issue a FTL.
This fine is calculated at the rate of one penalty unit for each period of 28 days or part thereof that the document is overdue, up to a maximum of five penalty units. The value of a penalty unit is currently $222, which makes the maximum penalty which can be applied for an individual – $1,110.
The ATO generally don’t apply penalties in isolated cases of late lodgement. As a rule, a penalty will not be applied to a late-lodged tax return, FBT return, annual GST return or activity statement if the lodgement results in either a refund or a nil result, unless:
- FTL penalty was applied before the return or statement was lodged (that is, the penalty will not be remitted even if the subsequent lodgement results in a refund or nil result)
- the unlodged item is a third-party data report, such as a taxable payments annual report.
What should I do if I haven’t lodged my tax return?
If you have one or more returns you haven’t lodged on time, get your information together ASAP and bring it on over to us, we will make the process as quick and painless as possible for you. If there is a penalty and if there is a chance of it being remitted – we will make a case on your behalf to the ATO.
If you cannot find all of the information you need, we can often obtain information direct from the ATO such as banks and employers and health insurance.
I am under the tax-free threshold, what do I do?
Did you earn under $18,200 and pay no tax? You may not be required to lodge a tax return; however, it is important to submit a non-lodgement advice to the ATO. This explains that you don’t need to lodge a tax return and makes sure they don’t list you as a late lodgement. If you don’t submit a non-lodgement advice, the ATO will assume you have earnt over the threshold and must lodge. We can help you prepare and submit your non-lodgement advice.