A TAMWORTH accountant is urging residents to be tax-savvy when lodging their returns amid a new crackdown by the Australian Tax Office (ATO).
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With just days to go until the end of the financial year on June 30, Mark Slack-Smith, principal of Forsyths, says work-related expenses are on the ATO’s hit list this year.
“The ATO has recently declared war on individuals who claim higher expenses in their tax returns than the average,” Mr Slack-Smith said.
“Usually it is the motor vehicle claim that they target and they will request significant evidence that you in fact used the vehicle for work purposes. 100,000 letters were recently sent to individuals asking for voluntary amendments to 2016 returns for such claims, if they deem the amendments still unsatisfactory they will request an audit. “
Mr Slack-Smith said residents should make sure they don’t “over claim” when lodging their returns and keep invoices for expenses. He said logbooks are a handy tool for car claims and should be kept up to date. He said many community members lodge their tax returns themselves, and only seek the assistance of accountants when they receive a notice of audit.
“Individuals should seek the assistance of a registered tax agent to assist them with their returns. The cost of the agent is tax deductible and they will ensure you remain compliant and out of the ATO’s crosshairs,” Mr Slack Smith said.
“Most accountants will keep you compliant with the necessary evidence required for your tax deductions. Although, with this time of year being so busy, accountants often don’t spend the time to plan for future tax deductions. This proactive advice often saves you significantly more in tax than the cost of the advice given and also gives you advice on insurances that you may not have been aware of, that gives you peace of mind.”
Mr Slack Smith said the ATO was determined to track down people lodging dishonest returns.
“With the increase in the ATO’s ability to monitor electronic data and also with the ATO’s own benchmarks, if an individual’s deductions exceed what the ATO seem satisfactory for their industry, you will receive a letter to either amend your return, or be prepared for an audit to prove your deductions are legitimate,” he said.
Mr Slack-Smith said Forsyths had recently developed an Iphone APP to offer residents tips and tools to get their tax on track and plan ahead, including a logbook.