– Myth, the ATO only audits dodgy people.
– Fact, anyone can be audited and Tax Audits can be time consuming, stressful and a costly exercise but they are a fact of life if you run a business, own a rental property or have your own self managed superannuation fund. Basically anyone who lodges a tax return runs the risk of being audited.
We are nearing the time of year that we send out the renewal notices for Audit Insurance. This year, we really encourage you to consider the potential benefits of having this protection!
The ATO have announced that they intend to ramp up audits and compliance checks in the coming financial years. This is largely in part due to the leniency offered during Covid hardship times. I am sure it comes as no surprise to anyone that this ‘leniency’ was only temporary.
In addition to the focus on individuals with higher than normal deduction claims, there is a new strong focus on sole traders and small business who accessed financial support during the challenging times brought about by Covid-19.
You are probably thinking ‘my records are really good, I don’t need audit insurance’. Whilst your ‘well kept’ records make the audit a little easier, it doesn’t make you immune from Audit. The audit process does vary however initial contact is generally a letter, followed by a phone call. From here, documentation and evidence is compiled and sent to the ATO employee handling the case. They may request further info or have queries about the documents provided. Before you know it, the fees to handle your audit have exceeded the initial cost of your tax return, and without a doubt, have exceeded the cost of your insurance premium!
When you receive your Audit Shield insurance offer this year, don’t dismiss it without a second thought. If you have previously declined to receive further offers but would like a quote, please contact our office.
If you have any questions regarding how Audit Insurance could benefit you, please do not hesitate to contact Kate in our office on firstname.lastname@example.org or 5437 8888.