To 31^st August 2011, the ATO has received just over 5 million 2011 tax returns and issued refunds totalling $9.36 billion.  In addition to this, around 475,000 prior year returns have also been received since 1 July 2011.

The ATO issued 499,000 2011 refunds with a value of $1.21 billion in the week to 31^st August.  While this is an enormous figure, the ATO is still on track with their processing times, with many clients receiving refunds into their bank accounts well in advance of the 14 day target.

Tax returns can sometimes take a little longer to process though, especially if you have obligations to Centrelink or the Child Support Agency.  The ATO cross-checks information with these agencies to asses any outstanding debts, and this can add three days or more to the processing.

In addition, complex tax returns may require manual processing, as will returns with high tax deductions or missing/incorrect information.

If you are concerned about the processing of your tax return and have not received any notification from the ATO in three weeks from the date of lodgement, please contact us or phone 13 28 65 to use the ATO’s automated system to check on the status.

The past year has seen some of the worst natural disasters to affect Australia in many years.  Floods in Queensland and Victoria have left many people and areas affected and rebuilding costs are expected to reach into billions of dollars.

To assist with the rebuilding these areas and providing help to people affected, the Australian Government has imposed a small additional levy for the upcoming 2011-2012 year.  This levy only applies to certain people and can reach up to 1% of taxable income.

But what does it mean to you?

Do I have to pay the flood levy?

That depends.  The flood levy is only payable if your taxable income is above $50,000 for the 2011-12 financial year.  This is based on your individual income, so your spouse/partner’s income is not included.  It is possible that one partner will pay the levy and one won’t.

Are there any exemptions?

Yes.  If your income is above $50,000 there is still an exemption that might apply to you.  There are three exemption classes that apply to people who were affected by the floods.  The Australian Tax Office is attempting to notify all those people who are exempt, but if you’d like to be sure, please either contact us or see more detail at the ATO website.

I am exempt.  What do I need to do now? 

If you are on a wage, you can ask your employer to reduce the amount of tax being deducted from your income that would otherwise be used to pay the levy.  You will need to complete a form and give it to your employer. 

If you are not on a wage (for instance you are a sub-contractor) and the ATO has identified you as being exempt, they will automatically reduce the amount of any PAYG instalment you have to pay.  If they haven’t, we can do this for you.  This can be a bit complicated, so we advise that you contact us so we can assist.

The ATO website has a lot more detail on this if you are exempt. 

And of course, you don’t have to reduce the amount of tax being deducted through the year.  It will simply mean you will either receive a larger refund or a small tax bill at the end of the year. 

I’m not exempt.  How much is it? 

The flood levy is only applied to taxable incomes of over $50,000.  If your income is over $50,000, you will need to pay the following: 

The ATO has developed an online calculator to help you work this out and give you a weekly amount, which is excellent if your employer does not automatically deduct tax for you or you are self employed. 

I still have a question.  Who can I ask? 

The flood levy can be complicated, and only lasts for one year.  If you have any additional questions, please contact us or check out the ATO’s flood levy webpages. 

Photo Credit: MartinHoward via Flickr

‘It is tax deductible, that means it is free!’
‘But I have to wear black and white to work; that means it is a uniform’
‘Just claim the $300 that I’m entitled to without receipts’

There are many tax myths out there, and everyone has heard at least one. Accountants hear pretty much all of them, from the very common to the really bizarre. News.com.au recently published a fantastic article dispelling some of the most common tax myths around.

How many have you heard?

Common Tax Myths
 

Naturally I won’t have my computer or your files with me, so I will be unable to assist you during this time. Phones, email and fax will be unattended during this period.

If you think you may need copies of tax returns or PAYG summaries for financing etc, please contact me by Monday 21^st March to allow me time to organise these copies before the office closes.

If you are yet to complete your 2010 return, the due date for most returns is Monday 16^th May 2010. Please take the opportunity while I’m away to start organising your 2010 documentation.

I’d like to take the opportunity to wish you all a Merry Christmas, and I hope that 2011 proves to be a successful year for everyone.

Cheers

ASHLEY

Anyone in business should take the time to familiarise themselves with the current Benchmarks, along with the ATO’s current audit approach.

For more information take a look at the following link.

http://www.ato.gov.au/businesses/content.asp?doc=/content/00214689.htm&page=1&H1

The office will reopen for business 9:00am Monday 21 June.

To assist tax agents with the impacts on their lodgment program workloads associated with our new income tax processing system, the Commissioner has reviewed the 15 May lodgment date for individual and trust income tax returns.

The Commissioner has granted a general lodgment deferral for all 2009 individual and trust income tax returns due to be lodged by 15 May to 22 May 2010. Payment (if required) will be due as per the notice of assessment.

The general lodgment deferral only applies to individual and trust income tax returns that have a due date for lodgment of 15 May.

James O’Halloran
Deputy Commissioner
Tax Practitioner and Lodgment Strategy

Until the matter is resolved, the Comissioner will continue to apply the view set out in Tr 98/9, that education expenses are NOT deductible against Commonwealth education income.

Click on the link for more information on the case of  Federal Commissioner of Taxation vs Anstis

14 April 2010

Refund cheque delays

We have identified an error where some of your clients may have received a notice of assessment without a corresponding statement of account or refund cheque. Due to this error, approximately 140,000 cheques were not printed.

We are fixing the problem and the cheques should be with your clients by the end of next week.

Annamaria Carey
Assistant Commissioner
Tax Practitioner and Lodgment Strategy

And the previous correspondence….

22 March 2010

Refund cheque delays

Last week, we experienced an issue that meant we had to stop a significant number of refund cheques from being sent out. This did not affect refunds paid by electronic funds transfer (EFT).

We apologise for the delay. We have fixed the problem and have resumed processing. The majority of these refunds will be delivered by the end of this week.

The date of issue on these cheques is likely to be from the week ending 12 March 2010.

Annamaria Carey
Assistant Commissioner
Tax Practitioner and Lodgment Strategy