Is the tax man just as scary as the boogie man? Should you avoid the tax man’s audit at all costs, and will an ATO audit on individuals have devastating consequences?
Don’t worry, there are easy and simple ways to keep the ATO’s eyes off your Tax Return, and even if the ATO does audit you, it isn’t the end of the world! Getting audited by the ATO is going to be more of a headache than not getting audited, but it’s nothing to stress over, and with some help from One Click Life, you have nothing to fear.
So… sit down on the couch, grab a drink, get comfortable, and keep on reading because in this article we will discuss how you can avoid being audited by the ATO, along with some tips for how you can protect yourself if you do get audited.
5 tax tips to prevent an audit from the ATO
We understand that you can’t be 100% accurate with your tax all of the time – it can be really hard – but if you try your best you will give yourself the best chance for success.
With One Click Life, our support team of tax professionals can hold your hand through the process and show you exactly what you need to do for a quick and simple Tax Return.
Here are some tips our tax team has prepared for you to follow in order to avoid trouble with the ATO:
1. Make sure you report your income
It is important that you try to report your income to the tax office as accurately as possible. A lot of people can think they can get away with reporting their income wrong, or not at all. Let’s not be one of those people.
The ATO keeps your personal income records for a very long time, and they’re quite good at finding little details and mistakes that don’t quite make sense, whether they be intentional or accidental.
But no need to fear my friend, OCL will help keep the ATO nice and happy with you, and more importantly we will keep you nice and happy with them! Our platform pre-saves and auto fills your information so you can finish a mistake free Tax Return in absolutely no time at all.
2. Make sure you claim the right tax deductions
As overwhelming as it might seem, it’s worth being very careful with your tax deductions, so please don’t try to just guess them or estimate how much you spent on something. If you don’t know what a tax deduction is, have a quick flick through ‘what deductions can I claim’ there’s many different topics to choose from, including industry specific tax checklists.
Make sure you have your receipts for the things you’re claiming, the ATO tax receipt requirements are quite strict.
If you no longer have your receipts, or you’re still not sure what you’re allowed to claim, that’s not a problem. Let One Click Life help you, and together, we can try to work out what work related expenses the ATO says you can and can’t claim – avoiding any headaches.
3. Always declare overseas income
The money you earn overseas is still taxed in Australia if you are an Australian resident for tax purposes, and it still needs to be reported to the ATO.
Trying to work out your foreign income and how it is taxed in Australia can be really confusing. Submit your Tax Return with OCL so one of our tax professionals can review your Tax Return before it is sent to the ATO, which will iron out any mistakes so you can avoid an audit from the tax man.
4. Incorrectly claiming rental property expenses
If you own a residential or holiday rental property, remember that all of the money that you earn from that property needs to be reported in your Tax Return. A lot of people around Australia forget to do this each year, with the help of One Click Life, you don’t have to join them!
Additionally, people sometimes don’t realise that you can only claim rent expenses as a tax deduction if the expense was made during a time when the property was genuinely available for rent.
This means that if your rental is sometimes used as a holiday home, and you use it or let friends/family stay there for free, any expense made during this period cannot be claimed as a tax deduction.
Submitting a Tax Return with OCL means a qualified tax accountant double checks your Tax Return before it goes to the ATO. So, if you’re nervous you might make a mistake, get started with us today for a simple and stress-free Tax Return.
5. Your assets don’t match your income
The ATO has access to what assets you own. If your assets don’t match the income you have declared, it may trigger some alarm bells.
For example, let’s say there’s a houseboat, a brand new car, and a penthouse apartment all listed in your name but your income is only $20,000 a year from your casual job at a cafe, the ATO may find that suspicious.
There isn’t any need to worry though. If you have several assets in your name and you’re worried they might be worth more than your income, One Click Life will help you explain to the ATO the reason why you own them.
We know that sometimes you might have been gifted these things, or you got them through another way. One Click Life’s professional tax support team can help settle any confusion with the ATO.
What happens if you do get audited?
If the ATO does audit you, don’t panic. All they want to do is look a little closer into your tax matters.
When you are being audited you need to do 3 things:
- Stay calm
- Be compliant with what they are asking you to do
- Get help from OCL’s support team so you are sure you’re doing things right
The worst thing you can do if you are being audited is try to hide things from the ATO. Just be transparent and let them look around. If you have nothing to hide, you have nothing to fear.
Why choose One Click Life
The more you deduct, the less tax you pay and the more money you can spend on yourself. The sure-fire way to do that is with the One Click Life platform. You can also claim your Tax Agent/Tax Return fee back on tax, so why wouldn’t you use one to minimise your tax and maximise your money?
One Click Life offers online Tax Returns at your fingertips in an easy-to-use platform run by industry professionals. Our Tax Returns take less than 5 mins!
Taxes, health insurance, and wills can be time-consuming and tedious. Our app allows you to be able to do this fuss-free, giving you a simple way to organise, track and manage all of your life admin in one place.
Let One Click Life take care of your Tax Return and life’s essential tasks, so you can spend more time doing the things you love.