Hi,
Just out of curiosity, has any one here ever had a audit done by the ATO or know of some one that has been?
Just out of curiosity, has any one here ever had a audit done by the ATO or know of some one that has been?
Investigated by ATO
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Been audited a few times - both standard "fill out this standard form which asks lots questions about my claims" type audits, plus a "we don't like your tax arrangements" letter sent to my accountant.
The form-audits are pretty straight forward - just need to justify things and provide documentation if required. I expect they would follow up if still not satisfied, but I never did receive any follow up.
The more in-depth audit, my accountant ended up negotiating with the ATO - they didn't like some of my personal claims, but it was stuff I could equally have claimed through my business - so we ended up submitting adjusted returns for myself and my business and they were satisfied in the end.
No big deal either way - but I have an accountant prepare my tax returns and I keep excellent records of everything, so I don't expect problems and if there ever are, I leave it up to my accountant to sort it out.
The form-audits are pretty straight forward - just need to justify things and provide documentation if required. I expect they would follow up if still not satisfied, but I never did receive any follow up.
The more in-depth audit, my accountant ended up negotiating with the ATO - they didn't like some of my personal claims, but it was stuff I could equally have claimed through my business - so we ended up submitting adjusted returns for myself and my business and they were satisfied in the end.
No big deal either way - but I have an accountant prepare my tax returns and I keep excellent records of everything, so I don't expect problems and if there ever are, I leave it up to my accountant to sort it out.
deductions or taxation arrangements ATO would usually ask for explanation or why you are doing this etc etc.
As long as you're not hiding money or not declaring income - or else it could get serious in terms of penalties.
i know of someone in the night clubbing business in a bit of trouble due to income related stuff.
As long as you're not hiding money or not declaring income - or else it could get serious in terms of penalties.
i know of someone in the night clubbing business in a bit of trouble due to income related stuff.
it's not the dreaded IRS style audit.
it's more like "your paperz are not in ze korrect order".
it's more like "your paperz are not in ze korrect order".
Agreed - the ATO I've found to be quite reasonable. If you keep good records, are neat and clean with your entries and on the borderline stuff, there are files notes justifying why you claimed it, it goes a long way to getting you over the line.
The two biggest problems are ;
(i) The initial shock / stress. This doesn't last too long once you get into the nitty gritty.
(ii) Accountant's expense via their time to wade through everything. We've taken out audit insurance for this. It costs about $ 400 pa, and is tax deductible whilst covering all of our entites up to a maximum of $ 10,000 worth of professional fees. We think it is worth it.
agree audited multiple times. If you keep computer records if in business, eg an electronic till as opposed to writing stuff down they don't seem to dig as deep. Although can be time consuming they have always been there to resolve rather than interrogate. Although I believe that there are sufficient legitimate structures to help you plan your situation so there is no need to be dodgy, do cashies etc. So that has probably helped my attitude during the multiple audits I have had
havent been audited yet, however, I did a bas for a startup small business, first Bas got a refund of $8k, second bas $2.5k,
accountant said, be prepared to get a pls explain from the ATO, didn't get one though, 3rd bas will be a refund as well, so am expecting a pls explain from the ATO
accountant said, be prepared to get a pls explain from the ATO, didn't get one though, 3rd bas will be a refund as well, so am expecting a pls explain from the ATO
I've never been audited by the ATO but it seems like if I do, I shouldn't get too stress out about it as long as I keep all the correct records and have nothing to hide I should be okay.
Seems normal to be audited here by the ATO but it's still something I would like to avoid.
Seems normal to be audited here by the ATO but it's still something I would like to avoid.
I was phoned by the ATO to arrange a sit down appointment at my convenience,
Nothing to worry about they said,just a few questions they would like to clear up???
They rang the day before our meeting and said they didn't realize how far out of town I lived and canceled the appointment.
I said I was disappointed as I had organized a list of questions for them
Nothing to worry about they said,just a few questions they would like to clear up???
They rang the day before our meeting and said they didn't realize how far out of town I lived and canceled the appointment.
I said I was disappointed as I had organized a list of questions for them
I was phoned by the ATO to arrange a sit down appointment at my convenience,
Nothing to worry about they said,just a few questions they would like to clear up???
They rang the day before our meeting and said they didn't realize how far out of town I lived and canceled the appointment.
I said I was disappointed as I had organized a list of questions for them
I always think that if the ATO have a question they should put it in writing and you should respond in writing, otherwise they are just going on a fishing expedition.
Agreed. We have insurance too. This year the probability of being audited is greater than ever.
Vero charges only $300 for the same cover.
Note that you're not covered if your return was fraudulent. Insurance is most helpful if you have complex dealings and been honest but will not work if you have evaded tax.
Depending on how you feel, first up either tape record the conversation or have a witness with you. feel free to advise them your recording it.
Where possible always ask a question with a question. get their personal response and if they have onethe formal ATO reply, however the person who does the audit is personally liable for anything they do or don't do. Reverse the onus nicely.
Always be as nice and courteous as possible as that is just good manners. The ATO are extrememly understaffed and they will tend to follow up easier targets than hard ones. Imagine your an auditor and the company says we want you to recover a hundred grand from claims made, here is a list of 1000 people who have made claims.
Would you go for the claimants who make life difficult or would you go to the clients who are easist to recover the money from. Naturally they are no different from you and I and will generally do whats easier.
You create the record, not the ATO, however their legislation generally reverses the Onus so that you have to prove to them that your claim is valid, you can reverse the onus back onto them depending upon what you say and do.
Think of the TV cop shows, they always get the baddy because the in the end the baddy confesses to the crime. So ifyou don't confess to the crime it makes it very hard for them to convict you.
Always remember this every person acts upon their own accord, no matter who they are employed by, so the person in the ATO who signs off on some sort of recovery or prosecution of you is the person you attack civilly initially.
For example they set up their appellant tribunal such that if you don't like what they do to you, you can appeal to their own tribunal, well you can guess what the outcome to that will be, so instead of going to their own tribunal, go straite to the courthouse and lodge your claim against them and take them on.
Like anything though, if they have you bang to rights then you will struggle.
Best of luck with them.
Where possible always ask a question with a question. get their personal response and if they have onethe formal ATO reply, however the person who does the audit is personally liable for anything they do or don't do. Reverse the onus nicely.
Always be as nice and courteous as possible as that is just good manners. The ATO are extrememly understaffed and they will tend to follow up easier targets than hard ones. Imagine your an auditor and the company says we want you to recover a hundred grand from claims made, here is a list of 1000 people who have made claims.
Would you go for the claimants who make life difficult or would you go to the clients who are easist to recover the money from. Naturally they are no different from you and I and will generally do whats easier.
You create the record, not the ATO, however their legislation generally reverses the Onus so that you have to prove to them that your claim is valid, you can reverse the onus back onto them depending upon what you say and do.
Think of the TV cop shows, they always get the baddy because the in the end the baddy confesses to the crime. So ifyou don't confess to the crime it makes it very hard for them to convict you.
Always remember this every person acts upon their own accord, no matter who they are employed by, so the person in the ATO who signs off on some sort of recovery or prosecution of you is the person you attack civilly initially.
For example they set up their appellant tribunal such that if you don't like what they do to you, you can appeal to their own tribunal, well you can guess what the outcome to that will be, so instead of going to their own tribunal, go straite to the courthouse and lodge your claim against them and take them on.
Like anything though, if they have you bang to rights then you will struggle.
Best of luck with them.
first up either tape record the conversation or have a witness with you. feel free to advise them your recording it
Unless you want to be in breach of the SURVEILLANCE DEVICES ACT 2007 for those in NSW then you will want to obtain consent from the other party. http://www.austlii.edu.au/au/legis/nsw/consol_act/sda2007210/s7.html
Unless you want to be in breach of the SURVEILLANCE DEVICES ACT 2007 for those in NSW then you will want to obtain consent from the other party. http://www.austlii.edu.au/au/legis/nsw/consol_act/sda2007210/s7.html
yes, as long as the max. no proof claim is max. $299 then all is good.
and then don't forget to declare the "Additional income" in total of monthly rent money from your tenants that's it.
Coastymike, it is true that is why I included witnesses as an option, however what they don't tell you is that such recording evidence can be used in other areas. For eg. should you tape record the ATO wihtout their consent in NSW then yes you can in theory be prosecuted, however never forget tthat the recording can still be used for matter such as perjury, etc and in civil cases, it is just a matter of how you work it.
Qld can record a conversation so long as your a party to the conversation for eg.
The easiest way to deal with it is say to the ATO agent, I intend to record this conversation, is that OK with you. If they say NO then you ask them why and so forthe and then go on about, well if you can't record the conversation then you feel that your going to be dealt with illegaly by the agent concerned and blah blah blah.
Puts them in a terrible position. So imagine later on after they have declined your offer of recording and you allege them saying/doing things wrong/illegal etc. Where do you think the weight of evidence will lie, in any non ato hearing when they find out that the ATO denied your request to record the conversation etc. It is all about being on the front foot.
The problem comes from when we know nothing and they just run over the top of us. The ATO is a highly discriminatory organisation as far as what the government has decided is right or wrong under their tax regimes.
EG you invest money overseas in some business and then if you make a profit they want you to include that other income in your tax, however if you lose money they want you to carry it forward as a capital loss into the future. The reason they do this is that they know that 80% of business fail, so in other words they never have to pay out so to speak.
Qld can record a conversation so long as your a party to the conversation for eg.
The easiest way to deal with it is say to the ATO agent, I intend to record this conversation, is that OK with you. If they say NO then you ask them why and so forthe and then go on about, well if you can't record the conversation then you feel that your going to be dealt with illegaly by the agent concerned and blah blah blah.
Puts them in a terrible position. So imagine later on after they have declined your offer of recording and you allege them saying/doing things wrong/illegal etc. Where do you think the weight of evidence will lie, in any non ato hearing when they find out that the ATO denied your request to record the conversation etc. It is all about being on the front foot.
The problem comes from when we know nothing and they just run over the top of us. The ATO is a highly discriminatory organisation as far as what the government has decided is right or wrong under their tax regimes.
EG you invest money overseas in some business and then if you make a profit they want you to include that other income in your tax, however if you lose money they want you to carry it forward as a capital loss into the future. The reason they do this is that they know that 80% of business fail, so in other words they never have to pay out so to speak.
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