Tag: Tax

Tax Office offers new tax file numbers to around 3,000 super funds

The Tax Office has written to 3,122 trustees of self managed super funds offering them a new tax file number (TFN) for their funds.

The funds’ existing tax file numbers were on a CD of scanned letters being sent to the Tax Office via an authorised (door to door) courier from the company contracted to print the letters. The courier received the CD but it was not delivered to the Tax Office and has gone missing.

Tax Commissioner Michael D’Ascenzo said he wanted to assure the community the Tax Office takes the privacy of their personal details very seriously.

“Nothing is more important to the community and fundamental to good tax administration than the security of taxpayer information,” Mr D’Ascenzo said.

“I am concerned that this parcel containing taxpayer information has failed to be delivered, even though the courier believes the parcel is still within their warehouse facilities.

“While there is no evidence the information has fallen into the wrong hands or been misused, I am taking the matter seriously.

“As there is a risk the information could be misused if the courier is unable to locate the CD, we are providing the relevant trustees the opportunity to ensure that there is no unauthorised use of their funds’ relevant tax records.

Tax office Media release 2008/53

New Zealand to Collect Australian Tax Debt

The Assistant Treasurer, Chris Bowen MP, today announced the entry into effect of the Assistance in Collection of Taxes Article in Australia’s tax treaty with New Zealand.

This article signifies that the Australian Taxation Office (ATO) and New Zealand’s tax authorities will work together to collect tax debt.

“The entry into effect of this Article along with the current renegotiation of other provisions in the treaty will further enhance economic links between the two countries and will strengthen trans-Tasman tax administration,” Mr Bowen said.

“It will also assist the ATO’s efforts in tracking down outstanding tax debts from people who have left Australia.

“Entry into effect of this Article reinforces the strong commitment the governments of Australia and New Zealand have to strengthening co-operation in the enforcement of tax laws and the collection of tax.”

Australia and New Zealand have now exchanged diplomatic notes confirming that they have completed the relevant internal procedures required and consequently the Article shall have effect from 8 September 2008.

The Article was inserted by the 2005 amending protocol, which focussed on strengthening the integrity aspects of the 1995 tax treaty.

The protocol entered into force in January 2007, with the entry into effect of the Assistance in Collection of Taxes Article to take effect after both countries had put in place supporting domestic arrangements.

ATO latest compliance program released

The ATO annual compliance program serves as a fair warning to all taxpayers, CPA Australia has said.

CPA Australia CEO Geoff Rankin said the ATO’s 2008 – 2009 compliance crackdown gave taxpayers, especially individuals and smaller enterprises, ample time and information to ensure their tax affairs were in order.

‘The program acknowledges the complexity and scope of the Australian tax system while aiming to ensure that all taxable entities are compliant,’ he said.

‘The system’s complexity is such that 73 per cent of individuals and 95 per cent of businesses now see a registered tax agent.

The compliance program is a timely reminder for businesses and individuals to speak to a qualified CPA tax agent where necessary to ensure their affairs are in order.
‘The compliance program’s approach which emphasises education, information and transparency as opposed to being purely punitive is a positive step. Nevertheless the program will utilise the technology and resources available to the ATO to ensure compliance and collect tax revenue due.’

Mr Rankin said the focus on smaller enterprises, ‘mum and dad’ investors, international transactions and individuals, meant reviewing and modifying behaviour where necessary was crucial.

‘Individuals, smaller enterprises and smaller investors, including those with offshore transactions, must take care in ensuring their affairs are in order. The complexity of some of these affected transactions means some taxation requirements may sometimes be overlooked but the need to be thorough, from a compliance viewpoint, has never been greater.’

The annual compliance program will focus on the following areas among others:

* investors (undisclosed capital gains including gains from disposing of assets to invest in superannuation)
* international transactions (using technology and agreements with international authorities to verify tax compliance of international transactions)

  • undeclared income (particular emphasis on partners and beneficiaries who have not returned their share of partnership or trust income)
  • work related expenses (focus on occupations with a pattern of rising claims)
  • cash economy (ATO will contact 50,000 businesses to inquire about their cash economy activity and conduct 5000 reviews)
  • rental property deductions (under-reporting of rental income and over reporting of deductions

‘The increasing use of sophisticated technology allows the ATO increased access to data and a greater capacity for data matching to determine compliance for a wide range of transactions. In 2007 – 2008 the ATO received around 78 million income records to ensure assessable income was correctly returned,’ Mr Rankin said.

‘While individuals and entities are being given every opportunity to comply, the penalties for non-compliance are high so if unclear as to your status speak to a CPA