The Australian Taxation Office is reminding all Australians that today is the last date to lodge their 2017 tax returns in order to avoid hefty fines. reported that as of Sunday afternoon, more than 9.4 million Australians had lodged their tax returns which are four per cent more than at the same time last year.
“Generally we’re looking at around 13 million people, as you can imagine a lot will be lodging with agents so we’re comfortable with where it’s sitting,” said ATO Assistant Commissioner Kath Anderson.
ATO has seen a five per cent increase over the past five years in the number of tax returns lodged by individual tax payers after the rollout of eTax and now MyTax.
“Every year there are people who don’t lodge [on time] for whatever reason, it might be they thought they were going to have a debt [and wanted to avoid paying], then there are others for whom life gets in the way.”
Mr Anderson said that he has heard all sort of excuses for late lodgement of tax returns from people.
“The most common ones are ‘I didn’t have time’ or ‘I couldn’t find my records’,” she said. “They’re not very good excuses, given it only takes 30 minutes on average to lodge through MyTax.
Not only this, he also mentioned some very outrageous excuses such as ‘My papers flew out of the window on the way to the accountant’. But his favourite one is ‘My accountant is in prison and doesn’t have access to a computer’.
Jokes aside, there are heavy penalties for late lodgement of tax return. There is a late lodgement penalty fee of $210 for every 28 days which can go up to a maximum of five penalty units or a total of $1050. However, it is not so straight forward. The taxation officers deal with every tax payer on case-to-case bases. For example, people who have a refund won’t be penalised for late lodgement or the penalty will be remitted in case of serious illness.
ATO will be giving special attention to people who earn an income through house sharing sites such as Airbnb because it has come to their notice that many people think that because they are not renting their house all the time, it’s not a business but a hobby.
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“The reality is that business versus hobby only applies to your personal exertion income. When you’re using your house, because you’re using an asset to earn income, you have to declare it from the first dollar, similar to interest.”
As far as work-related expense deductions are concerned, there are three golden rules to remember – you must have paid for it, it must be directly related to your income and you have to have a record to prove it.
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