Being a business owner means staying organised and on top of your taxes. This can be incredibly challenging during the off-season when business is slower. If you are behind on your late or previous year’s tax returns, don’t worry – there are ways to handle it.
Check out these few tips we’ve listed below to help you get started.
How Much Do I Have to Pay as a Penalty for Not Lodging My Tax Returns?
It is necessary to recall that the tax system is in place to help ensure everyone contributes their fair share. If you don’t lodge your tax returns, you may be penalised. The penalty cost will depend on several factors, including how late you are in lodgment, whether you have a history of non-compliance and the severity of your case.
If you lodge your returns late, you may still be eligible for a remission of the punishment. The ATO has various solutions available, so it’s essential to get in touch with them as soon as possible to discuss your situation.
Can Penalties Be Deferred?
While it’s essential to stay on top of your tax returns and pay any tax debts you may have, the ATO understands the fact that life can sometimes get in the way.
If you notice yourself in a position where you have missed the lodgement deadline, they are likely to waive any penalties if you have a good history of lodgement and payment. However, if you have multiple returns outstanding or an account of non-payment, they are less likely to be lenient.
In these cases, a tax professional can assist you in getting back on track as soon as possible is essential to avoid further penalties and interest charges. Taking care of your tax obligations is critical to being a responsible adult, so make sure you stay on top of it!
However, if you have more than one return left and a bad history of paying tax debts, chances are slim that they will relieve your penalty.
What’s the Danger of Failing to Lodge Tax Returns?
The ATO imposes a failure to lodge a time (FTL) penalty for each income tax return (including activity statements) that is late. The ATO uses an automated system to calculate and issue FTL penalties.
You may be subject to a late filing penalty if you’re late filing your return late. The fine is $222 of the unpaid tax for every 28 days the return is late. The ATO may also issue an administrative penalty of up to $5,000 for each return lodged late if it believes the late lodgment was deliberate or careless.
If you cannot lodge your return on time, you should contact the ATO as soon as possible to discuss what to do with your situation.
There are a few distinct approaches that you can handle your taxes if you end up filing them late or from a previous year. You can file an extension, which will give you more time to file your taxes but won’t necessarily waive any penalties or interest that you may owe. You can also file your taxes electronically, which can help to speed up the process.
If you own a lodge and have filed your taxes late or have previous year’s tax returns, it is strongly recommended that you hire an accountant and tax consultant. A tax advisor or Sunshine Coast accountant from SMB Accounting can help you ensure that you are compliant with tax laws and regulations and can also help you maximise your deductions and tax benefits. Book a meeting with us today!