As the end of the financial year approaches, many are turning their attention to tax returns and the potential implications of not meeting the Australian Taxation Office’s (ATO) deadlines. The ATO is ramping up its efforts to ensure compliance, and this could mean an unexpected phone call that you would not want to ignore.
In recent weeks, the ATO has been ‘actively chasing’ individuals with overdue tax returns, and this has resulted in a flurry of phone calls to taxpayers. According to Jenny Theodore, the founder of Eire Consulting, numerous Australians have reported receiving calls or voicemails from the ATO inquiring about their overdue tax returns.
‘If the ATO is unable to get through, what they are doing is leaving a voicemail and asking people to respond within two business days and to call them back and give them an update as to where the return is at and why it is overdue,’ Theodore warned.
It reportedly appears that the ATO is particularly targeting individuals with an Australian Business Number (ABN), which includes contractors, business owners, and those with side hustles. Since tax is not typically withheld from their earnings throughout the year, these individuals are more likely to have a tax debt to settle at the end of the year.
An ATO spokesperson told Yahoo Finance that they are making a ‘concerted effort to engage with taxpayers who have overdue tax lodgements,’ using a range of methods from SMS and emails to letters and phone calls.
‘We recognise that sometimes people do not meet their lodgement obligations on time, even with the best intentions,’ the spokesperson said.
If you receive a call from the ATO, however, it is crucial not to panic. The best course of action is to communicate openly with them, explain your situation, and assure them that you are taking steps to lodge your overdue return, whether on your own or through a tax agent.
The ATO is primarily interested in understanding what actions you are taking to resolve the issue.
Ignoring the ATO’s attempts to contact you can lead to further complications. There is a ‘failure to lodge’ penalty that can be applied, which is currently $330 for each period of 28 days that the return is overdue, up to a maximum of five times or $1,650.
Additionally, any unpaid tax debt will accrue interest at an annual rate of 11.42 per cent.
For those hesitant to lodge because they anticipate owing a tax debt, Theodore advises that it is possible to negotiate a payment plan with the ATO to pay off the debt in instalments.
‘You will pay a bit more but you are going to pay penalties and general interest charges by not lodging. So it is better to be paying off your debt and incurring interest but getting it paid off and getting your tax obligations up to date,’ she explained.
Most taxpayers can prepare and lodge their tax returns online, with most processed within two weeks.
But with scams on the rise, it is essential to be cautious. The ATO ‘will always call from a private number,’ and they will never ask for sensitive personal details like your Tax File Number or date of birth over the phone.
To protect yourself from scam calls, the ATO has highlighted several reminders to take note of:
1. The ATO will never send unsolicited emails or SMS with QR codes or hyperlinks to log into online services.
2. They will never request passwords, account numbers, or other sensitive data via email, SMS, or unsolicited phone calls.
3. Calls from the ATO will show as No Caller ID.
4. They will never threaten immediate arrest or demand you stay on the line until a payment is made.
If you are unsure whether a call is genuinely from the ATO, or if you have received a scam call and shared personal information or made a payment, it is imperative to call the ATO immediately at 1800 008 540 to verify or report it.
Staying informed and proactive about your tax obligations can save you from hefty penalties and unnecessary stress. If you have fallen behind, now is the time to take action and get your tax affairs in order.
Have you received a phone call from ATO lately? Share your experiences with the YourLifeChoices community in the comments section.
Also read: ATO and Services Australia warn over QR code scams and give tips on how you can protect yourself!
