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Advantages of Getting a Tax Accountant for Your Business

If you own a business, there are numerous advantages to hiring a tax accountant to help manage your financial affairs. A tax accountant is an expert in the field of taxation and can help you keep track of your taxes and identify and maximise any deductions that may be available to you. 

Additionally, a tax accountant can help you choose the most advantageous type of business entity for your company and understand the nuances of taxation related to that specific business entity. They can also provide valuable advice on financial and tax-related topics as you grow your business. 

By streamlining the procedure and being updated on all the laws, rules, and deadlines pertaining to tax filing, a tax accountant may help you save time and money. Ultimately, a tax accountant is an invaluable asset when it comes to managing taxes for your business.

You should think about employing an accountant for the following additional reasons.

A Tax Accountant Helps You Save Time

Nothing will be as easy as sitting down with a tax expert, despite the fact that there are various services available to help you file your taxes independently. Even if it can seem like the quickest approach to finish your lodging is to do your own tax return, it isn’t always the best option. 

To ensure you obtain the greatest outcomes, your tax accountants will ask you a number of questions and go through all of your alternatives during a session.

It may take considerably longer than a single visit with your advisor to gather your data, figure out your deductions, and then review your application to make sure everything has been done correctly.

They Lessen Your Anxiety

You have a great deal of responsibility if you file your return by yourself. If the Australian Taxation Office decides to review or audit your returns, any errors you make during the application process could resurface and pose issues. 

There may be fines, interest, or penalties due as a result. So one of the biggest reasons to employ a business advisor is that you will have assurance, knowing that your taxes are being handled by an expert if this is the portion of the taxing process that gives you anxiety. 

You can rest assured that your business will be in conformity with all applicable tax laws and that your return has been prepared correctly if you use tax accountants to file your return.

There Are Advantages to Extended Deadlines

The deadline for self-filed tax returns is October 31st, but if you use an agent to file, you can have a later deadline like May of the following year. You will have extra time to compile your deductions and contact your agent as a result.

They’ll Streamline the Procedure

Meeting with a tax accountant will be very helpful in clearing up the complexity surrounding tax returns. Your returns will be completed accurately and quickly. Interacting with your accountant is also a terrific method to educate yourself on the procedure. 

Using a tax agent will save you a lot of time and effort if you have many jobs, run a business, own property, or manage an investment portfolio.

Conclusion

After considering all the advantages, there is no doubt that getting a tax accountant for your business is the right choice. It will help you stay organised and maximise your chances of success by gaining valuable insight into the business’s financials. 

Tax accountants provide a great service and can save you from headaches down the road. Managing taxes better is an integral component of running a successful business, and having a tax accountant can ensure that you’re able to efficiently and accurately comply with all relevant tax laws.

Ultimately, bringing in a tax accountant offers numerous potential benefits for a business and should be seriously considered for any business of any size.

If you need assistance with your tax return on the Sunshine Coast, SMB Accounting is here to help! We can do your individual tax returns, small business accounting with various small business accounting packages available, SMSF audits, and more. Contact us today to learn more!

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A Closer Look at the Instant Asset Write-Off Tax Benefits

The Australian government has introduced a higher instant asset write-off (IAWO) threshold as part of the COVID-19 relief package. It’s essentially a cost-saving incentive for businesses that allows them to claim immediate write-offs for items purchased for business use. The ‘instant’ aspect of the IAWO scheme is particularly appealing for businesses – as it allows for faster tax deductions than other conventional credits. It may seem complicated, but understanding the basics could be beneficial for you and your business in the long run.

What Is the Instant Asset Write-Off?

The IAWO is designed to encourage businesses to invest in new assets to help increase their productivity, efficiency and competitiveness. It means that when businesses make eligible asset purchases, they can deduct a portion of the cost from their tax payable in the same income year.

Eligibility Criteria 

The IAWO applies to businesses with an aggregated turnover of $500 million or less. These businesses are eligible to claim an instant tax deduction for each asset it purchases or installs costing less than $150,000 purchased between 12 March 2020 and 31 December 2020. From 2021 to 2022, the threshold will be capped at $1,000, and businesses are eligible to claim $150,000 worth of assets each year.

How Does It Work?

The IAWO is a dollar-for-dollar deduction for businesses when they purchase eligible assets. There’s no limit to the amount of assets a business can write-off as long as each asset is valued under (or equal to) the IAWO threshold.

When a business buys an eligible asset and deducts its cost from their taxable income in the same tax year it was purchased, this is called depreciation.

By claiming a deduction for the asset’s cost in the same tax year it was purchased, businesses could potentially reduce their tax liability in this same time frame.

Claiming the IAWO 

It’s important to note that businesses must be registered with the ATO in order to claim the instant asset write-off. This also means that businesses must keep up to date with their ATO obligations, such as lodgement of business activity statements and income tax returns.

Businesses must also supply evidence of the asset’s purchase and installation to the ATO by way of valid receipts.

Advantages of the Instant Asset Write-Off

The IAWO can be beneficial for businesses in a number of ways. Not only does it enable businesses to receive a tax deduction for assets in the same income year as the purchase was made, but it also allows businesses to reinvest any savings back into the business to help them grow and develop.

Being able to invest in assets to expand or update their business operations with the IAWO, businesses can focus on the bigger picture. This can help with product or service advancements and modernisation while enabling businesses to remain competitive.

Conclusion

The IAWO allows businesses to ‘instantaneously’ receive tax deductions on eligible assets they purchase or install. By supplying suitable evidence of the asset’s purchase and installation to the ATO, businesses can easily claim their tax deductions during the same tax year. What’s more, this could lead to considerable savings for companies to reinvest back into their business.

If you want to learn more about small business asset write-offs and other tax benefits, it’s best to work with a professional accountant to ensure you are getting the most out of your tax deductions. At SMB Accounting, our Sunshine Coast accountants do all that and more. When you work with us, you can be sure that your finances are in safe hands. Contact us today, and let us help you with your tax deductions and asset write-offs.

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When Should You Get an Audit For Your Business?

An audit is an important step for any business, regardless of size. A financial statement audit verifies correctness and adherence to rules and regulations by examining the financial statements independently.

In addition to assuring stakeholders, an audit provides insight into a company’s financial health and performance.

Corporations frequently use a public accounting firm for auditing their financial accounts. Audits are occasionally a work the organisation must carry out, although they can be expensive and time-consuming.

However, how can you know if you fit in with this group?

If you’re unsure whether an audit is the best option, ask these important questions to guide your decision-making and learn where to find accountants on the Sunshine Coast QLD. 

What Is An Unbiased Audit? 

A company may use an impartial CPA or CA, a third party, or an independent public accounting firm to analyse its financial records and transactions to minimise conflicts of interest and protect the audit’s integrity.

Audits are regularly performed to protect shareholders and potential investors from erroneous or deceptive financial statements. 

The auditor is typically in charge of financial accounting and related data analysis, reviewing corporate policies and practices, determining the worth of the company’s assets and looking for signs of impairment, calculating tax obligations, and verifying that rules and the tax code are followed.

What Reasons Are There For An Audit?

Numerous circumstances might prompt a corporation to begin an audit. Consider the components of the following business models that demand independent audits:

  • Venture-backed: Many venture capitalists do this, though not all of them. They have the right to demand that an experienced third party conduct an in-depth audit of your financial accounts.
  • Bank-affiliated: Not all banks will want an audit of the financial records of your business. However, a lot of people of a certain size do require them.
  • Seller: Every corporation that intends to sell its firm would be wise to organise an audit. Most prospective purchasers will require one because they want to confirm that the numbers you present adhere to GAAP. The sale price can increase with two to three years’ worth of audited financial documents.
  • Public: You need three years’ worth of audited financial documents to float your business.

When Ought One To Think About An Audit?

If you plan to have your financial accounts audited, you should work with a financial expert and set up a meeting with your audit team early.

You must inform your financial staff of the difficulties facing your business and give them ample time to complete their list of audit request items.

What Actions Should You Take To Prepare For An Audit?

The more prepared you are, the faster and easier an audit can be conducted. Preparation begins well before the audit and has much to do with how your business initially handles its finances.

Make sure your business is audit-ready by carrying out the following important tasks:

Implement a rigorous closing process each month. Making sure that all transactions, journal entries, and financial statements are timely and precisely recorded will be made simpler.

Collaborate with a seasoned financial specialist to assist you with your business ambitions. The smartest way to organise, plan, and handle financial issues is to find the right financial consultant.

Look for someone with auditing experience. Usually, this will be the company’s chief financial officer or an accountant on the Sunshine Coast. The CFO will be in charge of working with the audit team, offering any pertinent information, and resolving any potential issues.

Amass the required information, documents, and data.

What Documents Are Needed For An Audit?

For a typical audit, access to the following will be required:

  • broad transactions
  • confirmation of significant assets (i.e., cash, accounts receivable, etc.)
  • Corporate records about equity
  • Material contracts
  • Internal system safeguards are examined
  • P&L classification for expenses

Conclusion 

Companies need to understand when to get an audit. The timing of an audit depends on the size and nature of the organisation, the type of audit, and the organisation’s goals. 

Generally, companies should consider getting an audit by accounting firms on the Sunshine Coast if they are experiencing significant changes in their business structure, operations, or finances or if they need to meet certain legal or regulatory requirements. 

Additionally, companies should consider getting an audit if they want greater assurance and visibility into their financial statements and performance. Ultimately, the right time to get an audit depends on the needs and goals of the organisation.

SMB Accounting does Individual tax returns, small business accounting with various small business accounting packages available, SMSF audits (self-managed super funds), and a Xero accounting software-based accounting business. We also offer the following audits: trust account audits, audits of non-profit organisations, audits of special purposes financial statements, special needs audits, and more. Speak to an accountant on the Sunshine Coast today!

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5 Reasons Why Small Businesses Need an Accounting Firm

Running a small business can be overwhelming and time-consuming. With the help of an accounting firm, small business owners can simplify their finances and make sure that their company is running efficiently. Here are five reasons why small businesses need an accounting firm.

1. Access to Professional Financial Advice

As a small business owner, it’s important to have a good handle on your finances. An accounting firm can provide professional advice on tax planning, cash flow management, and budgeting. This can be extremely helpful in making sure your business is on the right track.

There are a few things to keep in mind when working with an accounting firm. First, be sure to ask plenty of questions. It’s important that you understand the advice they’re giving you, and how it will impact your business. Second, don’t be afraid to negotiate. Many firms are willing to work with you on pricing, so don’t be afraid to ask for a better deal. Finally, make sure you’re comfortable with the firm you choose. You’ll be working with them closely, so it’s important to make sure you’re compatible. If you’re looking for professional advice on how to run your small business, an accounting firm is a great resource.

2. Improved Cash Flow Management

Accounting firms can help small businesses manage their cash flow more effectively. They can provide advice on budgeting and cash flow forecasting, as well as help set up systems to make sure that payments are received on time.

3. Reduced Risk of Mistakes or Errors

When it comes to finances, there is no room for error. This is especially true for small businesses, who may not have the resources to weather a financial mistake. This is where an accounting firm can help.

An accounting firm can help minimize the risk of financial mistakes. They can help small businesses stay on top of their taxes, ensure accurate accounting records, and provide guidance to ensure that the business remains in compliance with applicable laws.

4. Increased Efficiency

An accounting firm can help small businesses streamline their processes. They can set up systems to automate certain financial tasks, such as billing, invoicing, and payroll. This can save small businesses both time and money.

5. Peace of Mind

As a small business owner, you have a lot on your plate. You’re responsible for keeping your business running smoothly, achieving your goals, and growing your business. This can be a lot to handle, and it’s easy to get overwhelmed.

One way to ease the burden and take some of the stress off of your shoulders is to work with an accounting firm. Having a team of professionals to handle your finances and keep your books in order can give you peace of mind and help you focus on what’s important.

Conclusion

Overall, an accounting firm can be a valuable asset to small businesses. They can provide professional advice and help streamline financial processes. This can save small businesses time and money, while also giving them peace of mind. Working with an accounting firm is an important step for any small business owner.

If you’re looking for a reliable tax consultant, then you’ve come to the right place. SMB Accounting is fast becoming one of the leaders in Australia when it comes to providing accounting services. As an accounting firm serving Brisbane, Sunshine Coast, and Fraser Coast, we help clients by providing business advice, taxation, and XERO/MYOB/Quickbooks consulting. Whenever you need help managing your income tax returns or keeping your finances in check, SMB Accounting is the one to call. Contact us today to get started.

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9 Things You Can Refund From Your Work Travel Expenses

Regarding work travel expenses, it can be challenging to know precisely what you can and can’t get reimbursed for. Fortunately, a few standard fees can be refunded, depending on the company’s policy. 

You can get reimbursed for these nine things from your work travel expenses as long as they’re included in the company’s audit process:

1. Airfare

Airfare is typically one of the most expensive parts of any work trip, so it’s essential to make sure you are reimbursed for this expense. Many companies will provide you with a travel voucher or credit card to pay for your flight and then refund you for the cost.

2. Lodging

Depending on the company, you can get reimbursed for your lodging expenses. This could include the cost of a hotel, Airbnb, or other lodging arrangements. Be sure to check the company’s policy to make sure you are within the allowed limits. For example, if you need to stay in a hotel while travelling for work, you can get a refund for the cost of your stay. You will need to keep your hotel receipts to send to your company.

3. Incidentals

Incidental expenses, such as parking fees, internet access, and other costs you may incur while travelling, can typically be reimbursed. Be sure to save any receipts for these expenses to be refunded.

4. Business Supplies

You can be reimbursed for these expenses if you need to purchase any supplies for your work trips, such as office supplies or business cards.

5. Transportation

You can be reimbursed for the cost if you need to take public transportation, such as a bus or train, to get to your work destination. Be sure to save your tickets or receipts to be reimbursed.

6. Meals

Depending on the company policy, you may be able to get a refund for meals while travelling for work. Some companies provide meal allowances or reimbursements for meals purchased while on the job. Remember to compile all receipts and any paperwork related to meals so you can submit them for reimbursement.

7. Car Rental

If you need to rent a car while travelling for work, you can get a refund for the rental cost. Many companies will reimburse you for or at least part of the rental. Compile all your receipts and run them for the company audit process. Wait for it to be refunded.

8. Parking Fees

You can get a refund for the cost of the parking and let it run on your company’s audit process. The companies will reimburse you for the parking, or at least part of it. Keep all your receipts and any paperwork related to the parking so you can submit them for reimbursement.

9. Conference Fees

Suppose you attended a conference or seminar connected to your job. Be sure to keep any receipts from the conference and submit them for reimbursement.

Conclusion

When it comes to working travel expenses, there are a few ordinary expenses that can be refunded. Be sure to check your company’s policy on reimbursement to make sure you are within the allowed limits. You can ensure you get the most out of your work travel expenses with the correct information.

SMB Accounting offers a range of services for small businesses, from individual tax returns to small business accounting, SMSF audits, and Xero accounting software-based accounting. With competitive rates and flexible payment options, our business is suitable for anyone looking for a reliable and efficient audit process and accounting service. Contact us today!

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5 Important Factors to Consider When Hiring a Tax Accountant

Tax season can be a stressful time for individuals and businesses alike. With the ever-changing tax laws, filing taxes can be a complicated and time-consuming process. That’s why it’s important to find a qualified tax accountant who can help navigate the complexities of the tax code. But, with so many options available, how do you know which tax accountant is the best for you? To make the decision easier, here are five important factors to consider when hiring a tax accountant. 

1. Credentials

The first and most important factor to consider when hiring a tax accountant is their credentials. Make sure the accountant you hire has the necessary qualifications and certifications. The most common qualifications include a Certified Public Accountant (CPA) or Enrolled Agent (EA). A CPA is a professional who has passed the CPA exam and is licensed to practice public accounting. An enrolled agent is a federally-authorized tax practitioner who has demonstrated expertise in tax law. 

2. Experience

When it comes to taxes, experience is everything. You want to make sure that the tax accountant you hire has the necessary experience to handle your unique tax situation.

Ask about their experience in filing taxes for individuals, businesses, or both. Additionally, ask about the types of tax situations they’ve handled in the past. This will give you a good idea of whether or not they’re up for the task.

It’s also important to choose a tax accountant who is familiar with the tax laws in your state. This will ensure that they can provide the best possible advice and service.

3. Reputation

Before hiring a tax accountant, it’s important to do your research and find out what others have to say about them. Check out online reviews and ask for references from past clients. This will give you a better idea of the quality of service the tax accountant provides.  You should also ask for referrals from friends or family. If someone you trust has had a good experience with a particular accountant, that’s a good sign.

4. Cost

Cost is another important factor to consider when hiring a tax accountant. Ask for a quote before hiring to make sure that their services fit within your budget. Also, make sure to inquire about their payment policies. You want to make sure that you understand the full cost of the services before signing any contracts. 

5. Communication

Finally, it’s important to ensure that the tax accountant you hire has good communication skills. After all, they will be responsible for helping you make important decisions regarding your taxes. Make sure that the accountant you hire is someone you feel comfortable discussing your financial situation with.

Conclusion

We hope this article helps you gain a better understanding of how to hire the right accountant. These are five important factors you should consider when hiring a tax accountant. It’s important to take your time and

If you’re looking for a tax consultant, then you’ve come to the right place. SMB Accounting is fast becoming one of the leaders in Australia when it comes to providing accounting services. As an accounting firm serving Brisbane, Sunshine Coast, and Fraser Coast, we help clients by providing business advice, taxation, and XERO/MYOB/Quickbooks consulting. Whenever you need help managing your income tax returns or keeping your finances in check, SMB Accounting is the one to call. Contact us today to get started.

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ATO Audit Triggers to Be Aware Of

When people hear the words “ATO Audit,” they usually either try to ignore it or take immediate steps to respond to the situation.

What many do not know is that being aware of the details you include in your tax return is essential to avoiding an ATO Audit. Doing your taxes accurately and honestly is the best way to ensure that you don’t invite attention from the ATO. Being proactive and meticulous with your tax return will help give you a good standing with the ATO and, hopefully, prevent an audit.

It is important to be mindful of your tax documents and ensure that everything is accurate and up-to-date. Double-check that all your information is correct and that you have the necessary documents needed before submitting anything to the ATO. As the ATO has shifted away from its more lenient approach to compliance, errors on your forms could lead to costly consequences. Be sure to double-check everything and make sure you are up-to-date with the latest regulations.

There are many ATO audit triggers. However, we would like to focus on the major ATO audit triggers: data-matching and ATO prefilling. Here, our tax consultant shares some of the things for you to take note of about what triggers an ATO audit:

Data-Matching

Data-matching is a process used by the Australian Taxation Office (ATO) to detect inaccuracies or discrepancies between data reported by taxpayers and data held by third parties including banks and employers. This data-matching process helps the ATO identify any potential non-compliance with taxation obligations.

Data-matching is a key ATO audit trigger. This is when the ATO matches information received from third parties, such as banks, employers, and other government agencies, to the information you provided on your tax return. If there is a discrepancy between the two, the ATO will investigate further.

To prevent an ATO audit due to data-matching, it is crucial to ensure that you accurately and honestly report all income, deductions, and other relevant information on your tax return. In addition, make sure you are paying the correct tax on all income and that you are not claiming deductions you are not entitled to.

Suppose the ATO believes there is a discrepancy between the information provided by a taxpayer and the information held by the third party. In that case, they may undertake an audit to investigate the matter further.

ATO Pre-Filling 

Another ATO audit trigger is ATO prefilling. This is when the ATO prefills your tax return information based on data from third parties. This data includes income, deductions, and other relevant information. The ATO may investigate further if there is a discrepancy between the information you provided and the prefilled information.

To prevent an ATO audit due to prefilling, it is important to review the prefilled information carefully and ensure it is accurate. If there are any discrepancies, you should contact the ATO and provide supporting evidence to explain the discrepancy. 

Conclusion

Data-matching and ATO prefilling are two important ATO audit triggers. It is crucial to ensure that all information on your tax return is accurate and honest and that you are paying the correct amount of tax on all income. Additionally, be sure to review the prefilled information carefully and contact the ATO if there are any discrepancies. Following these tips and working with a reliable tax professional can help you avoid an ATO audit.

SMB Accounting’s tax consultant can guide you and help ensure that you won’t face an ATO audit or, if you already are, that you’ll be taking the right steps so you can sort things through with the ATO. Contact us today to learn more about our services!

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5 Reasons Why Your Business Needs a Financial Audit

Financial audits can provide your business with a variety of benefits. Not only do they help to ensure that your financial records are accurate and up-to-date, but they also allow you to identify areas where you may be able to improve your processes and save money. Here are five reasons why your business needs a financial audit.

Compliance

As a business owner, it’s important to stay compliant with government regulations. One way to do this is to get a financial audit. This will help ensure that your financial records are accurate and up-to-date.

A financial audit can be conducted by an external auditor or by an internal auditor. Either way, the goal is to examine your financial records to see if they are accurate and in compliance with any applicable regulations.

The auditor will review your financial statements and supporting documentation. They will also test your internal controls to see if they are effective. After the audit is complete, you will receive a report that outlines any areas of concern.

Getting a financial audit is an important part of complying with government regulations. By having your financial records audited, you can ensure that you are in compliance with any regulations that apply to your business.

Fraud Detection

Audits can help to detect any fraudulent activity or discrepancies in your financial records. This is especially important for businesses that handle sensitive data or have a high level of financial transactions.

Tax Preparation

Audits can help to ensure that your business is in compliance with tax regulations and can help to ensure that you are taking advantage of any available tax deductions or credits. Overall, audits can be a valuable tool for businesses. They can help to ensure compliance with tax regulations and can uncover potential areas of improvement. If you’re facing an audit, stay calm and cooperate with the auditor. Be prepared to provide documentation and answer any questions that the auditor may have.

Efficiency

Audits can help to identify areas of inefficiency in your financial processes. This can help you to streamline your processes and save money over time. For example, if you are manually processing invoices, an audit can help you to identify ways to automate the process. This can save you time and money in the long run. Similarly, if you are using outdated software, an audit can help you to identify ways to update your system. This can also save you time and money in the long run.

Investor Confidence

Investors will often require a financial audit before investing in your business. Having an audit completed can help to instill confidence in potential investors and increase the likelihood of securing investment.

Conclusion

Overall, financial audits can provide a variety of benefits to your business. They can help to ensure compliance with government regulations, detect fraud, prepare for taxes, identify inefficiencies, and instill confidence in investors. If you have not had your financial records audited recently, now is the time to do so.

If you’re looking for help with the audit process, then you’ve come to the right place. SMB Accounting is fast becoming one of the leaders in Australia when it comes to providing accounting services. As an accounting firm serving Brisbane, Sunshine Coast, and Fraser Coast, we help clients by providing business advice, taxation, and XERO/MYOB/Quickbooks consulting. Whenever you need help managing your income tax returns or keeping your finances in check, SMB Accounting is the one to call. Contact us today to get started.

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Helpful Advice to Apply to Your Tax Return Preparation

It pays to put in a little time and effort to make sure you have every detail of your return correct and that you have avoided some of the more common traps that people tend to fall into. 

This is important, knowing that 84 per cent of taxpayers expect a refund and the average size of refunds last year reached close to $3,000.

Below are the best tips for doing your taxes correctly this year.

Make an Eligible Claim

Any expense you incurred in generating your income is eligible for a deduction. So don’t be afraid to claim an expense if you’ve incurred it for work-related reasons and have the supporting documentation.

Avoid Overstating Deductions

Only the amount you spent may be claimed. Therefore, only deduct expenses that you can show you paid for by providing an invoice, receipt, or bank statement, and avoid inflating deductions to get a higher refund.

Self-lodgers using the ATO’s myTax programme are watched by the ATO’s computer systems while preparing their returns to ensure they aren’t overclaiming. The ATO’s computer systems compare your claims to those of people with similar circumstances. 

If your claim raises red flags, myTax will issue a severe warning and encourage you to reconsider that deduction. If you disregard the warning, an audit may be coming your way.

If it turns out that your deduction claims were false, you’ll have to pay interest on top of the tax you could have avoided. The interest levied by the ATO is determined on a daily compounding basis and is based on the rate for 90-Day Bank Accepted Bills, but with a 3 per cent uplift factor. 

A penalty of 25 per cent to 95 per cent of the tax evaded may also be imposed if the ATO thinks you acted irresponsibly.

Use Caution When Using Pre-Filled Data from the ATO

You may pre-fill a lot of your income information directly from the ATO’s computers with the click of a button. However, be cautious and avoid assuming that income data is accurate or comprehensive. 

Always utilise your own data as the primary source. Some individuals believe that since the data is from the ATO, it must be accurate. That is a perilous supposition.

Even though you copied the data directly from the ATO’s pre-filled data, the legal responsibility will fall on you if you omit income and the ATO questions you.

Note the Basics

The ATO holds up a lot of tax returns because people make simple errors like this. Inform the ATO of any name or address changes before filing your return. 

The ATO won’t be able to connect it with your Tax File Number if you lodge under different details. There will be delays.

You must include your bank information on your return since the ATO no longer mails refund checks. Also, your return may disappear into thin air as the ATO manually matches your information if you accidentally typed an extra letter into a crucial field like your name.

Conclusion

Taxes are complicated, which is why 74 per cent of Australians use a tax professional to complete their tax returns. If you file your tax return incorrectly, you could face penalties from the ATO or a smaller refund.

The majority of consumers find it much less stressful to simply provide their tax agent with all the information they need, trusting that the agency will complete their return accurately and completely. 

A seasoned agent will typically be adept at spotting those elusive tax deductions you didn’t know you could claim, so they can frequently more than pay for themselves.

SMB Accounting is here if you need help with tax returns in Sunshine Coast. We can do your individual tax returns, small business accounting with various small business accounting packages available, SMSF audits, and more. Call us today to get started.

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Your Tax Return – Is it Correct?

Given that 84% of Australian taxpayers anticipate receiving a refund and the average size of returns exceeded $3,000 the previous year, it is in your best interest to double-check that your tax return is correct in every way.

Read on to discover more about tax returns and how to (finally) do it right this time around.

Assess Your Claim to What Is Legitimately Yours

Any expenditure that generates a profit can be deducted as a business expense. You should file a claim for any work-related expenses for which you have documentation. Most taxpayers are permitted to deduct expenses related to automobiles, travel expenses for work, and costs of equipment and work tools.

By speaking with an experienced tax accountant, you can lessen your chances of getting audited by learning which deductions are legal and which are not.

Skip the Dramatics, and Don’t Exaggerate

Only expenses are allowable deductions from taxable income. In order to earn a higher return, do not inflate your deductions; instead, ensure that any charges you claim can be proved by an invoice, a receipt, or a bank statement.

Self-declarants who use myTax are scrutinised by ATO computer systems to ensure they are not filing an excessive number of claims. If your deduction generates a warning, myTax will prompt you to reconsider accepting it. If you choose to disregard the notification, you risk being subjected to an audit.

If the deductions you claimed were incorrect, you must repay the tax as well as any relevant interest. The ATO calculates daily compounded interest at a rate equal to the 90-Day Bank Accepted Bill rate plus three percentage points. If the Australian Taxation Office (ATO) deems that your acts were negligent, it may levy a penalty ranging from 25% to 95% of the tax evaded.

Avoid Using ATO-Prefilled Data

At the moment, ATO’s computers can pre-populate a substantial amount of information regarding income. However, don’t assume that income data is correct or complete. Always rely on your own knowledge and firsthand information. Some people believe ATO data is reliable, but this is simply a dangerous assumption to make.

Even if you utilised pre-filled information on your tax return, you could face legal consequences if you disguised income and were later questioned about it by the ATO.

Focus On Everything, Especially the Essentials

The Internal Revenue Service can delay the processing of many tax returns due to trivial errors.

For example, if you’ve lately relocated or changed your legal name, make sure that before filing, you notify the Internal Revenue Service. If you use distinct information, the ATO will be unable to match your tax filing number.

Another example is if you have not provided bank account information. Because the ATO is unable to ship refund cheques at this time, make sure you give your bank account information. Otherwise, you don’t get the refund.

Furthermore, let’s talk about typos. If you add a letter to a required field, such as your name, the ATO will manually match your information. For example, if you add a letter to the “address” field, it will be automatically disregarded or ignored.

Do It Right with a Professional

Giving their information to a tax professional who will prepare their return in an accurate and comprehensive manner relieves the great majority of clients’ stress. When you hire a good agent, they should be able to identify hidden tax deductions that you were not aware of, resulting in the agent more than paying for themselves. Tax preparation fees are tax deductible!

Conclusion

It’s true that the Australian tax system is so convoluted that many people get confused. Thankfully, we can hire the services of a trusted professional tax agent. By learning with a professional, you can do your taxes right again and again!

Are you in need of a tax professional’s guidance? SMB Accounting is here to manage your finances, including your taxes. Work with us today!

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