ATO changing tax assessment (personal)

Discussion in 'Accounting & Tax' started by tattoo, 4th Nov, 2019.

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  1. tattoo

    tattoo Well-Known Member

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    I submitted tax return end of Sep but recently got notification that the ATO had reassessed the return and whacked on an additional 3K of tax payable. But no explanation on why. The figures on the income tax return matches the info originally submitted, so can't see why the 'estimated' tax from the first lodgement is so off.

    Has anyone else had this reassessment ? Is this common, I've not had this before. How can I find out more from ATO what happened ? I can lodge an 'objection' but I"m just after info atm
     
  2. qak

    qak Well-Known Member

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    Check the original assessment against the amended assessment. There will be a line somewhere that shows at least what is different.

    nb - do you have a spouse? Reassessment could relate to one of the family income tests - think child support, child care subsidies, medicare levy surcharge, overclaiming PHI rebate ...
     
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  3. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    I suspect Div 293 (extra 15% tax on super contributions) or excess super contributions above $25K. Your MyGov inbox will have the notices. Many taxpayers ignore these messages assuming their estimate will be what is assessed. It is quite common.

    The assessment notice and relevant docs will be in MyGov. The ATO used to amend well after the event but now tends to process these things on lodgement so they dont "amend" but just correct the return lodged. But there is a trail of notices and info is included in the Notices and account. In which case get cracking as the docs to explain it are time limited and a release from the fund may be permitted to pay the specific tax attributable to either D293 or excess contributions.

    You cant object to a lawful imposition of a tax. You need to identify the cause before assuming its an objection issue.
     
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  4. tattoo

    tattoo Well-Known Member

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    Thanks everyone, found the amendment details
    @Paul you are correct, it was my over contribution in super coming back to bite me in the assessable income offset by slight increase in the tax offsets. I thought the ECC was the penalty. Not going to set a fixed salary sacrifice to super again, forgot the bonus, lost track of it
    gah
     
  5. Trainee

    Trainee Well-Known Member

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    A division 293 additional tax on concessional contributions is clearly labelled on the letter (in giant blue font).

    How is that not an explanation?

     
  6. Paul@PAS

    [email protected] Tax, Accounting + SMSF + All things Property Tax Business Plus Member

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    Many taxpayers dont login and check MyGov messages and hence they dont understand why their $XXX refund becomes $YYY. MyGov is very user unfriendly.

    Salary sacrifice shouldnt be avoided for the minor issue. Employees who get a bonus should always consider that in their calcs and it may be better to target say $5K less to the $25K cap and then recalc your remaining cap in April - May and then make a personal deductible contribution OR a lump sum extra contribution under sal sac for the gap. Bonuses are a common issue. Other big one is employers who dont pay super with a consistent date....eg They pay catchup amounts or pay 5 quarters in the year etc. A salary sacrifice agreement can also cater for a bonus so no extra super as such is paid BUT the terms of it would also allow the employer to cut your 9.5% as well. So you have to accept a excess is a risk to balance that.

    We are also seeing many employers catchup significant arrears in unpaid super with the media and ATO / Fairwork focus on unpaid super as wage theft.

    Just as you may check a payslip dont assume a super payment happens when you get paid. Get online access to your super and check it
     
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