Tax FAQ's

QUESTIONS

Do I get my tax rebate in cash?

Yes, you will get a cheque that you can immediately deposit in your bank.

If the ATO trusts me to assess my own taxable income, why shouldn't I just take my chances and exaggerate my deductions?

The ATO devotes significant resources to the random checking and audit of returns. Penalties apply to fraudulent and mistaken tax returns.

Okay, but what if I make an honest mistake?

You will find in your Tax Pack a guarantee that a taxpayer who honestly and diligently follows the instructions in the booklet and then makes an honest mistake will not be liable. You can also get a copy of the Taxpayers' Charter from the Tax Office.

I earned less than the annual tax free minimum income in one two week period, but I still paid PAYE tax. Why?

This is because tax is paid on weekly income over a certain threshold. If this is all you earned you will in effect not pay tax because you will receive the tax paid in a rebate when you file your tax return.

My cousin doesn't live in Australia. Why does he have to pay tax on the income he earned working for my uncle in Melbourne?

Tax is paid on income earned in Australia. It does not matter of he is a resident of another country.

We made a capital loss on some shares we bought, but we also made a capital gain on a property we sold in the same financial year. What happens?

See your tax agent, but in general you may be able to apply the loss against the profit you earned when determining capital gains.

How long do I have to keep the original receipts that I have used to substantiate a deduction?

In general you should keep them for at least five years. Check with the ATO.

I don't understand why we can't deduct the cost of the delivery van we bought for our flower business? After all, we can't run the business without it!

True, but the benefit lasts over a long period of time, perhaps the life of the business, and so it is not considered an "expense" as such. Remember, you will certainly be able to deduct the cost of maintenance, petrol etc.

Why shouldn't I get interest payments of the amount of tax I paid? I objected to the assessment and the objection was upheld.

You are entitled to receive interest payments and this will happen automatically.

Can I get an extension to pay my tax?

It is possible to get an extension from the ATO, but you will have to convince them that there are legitimate reasons.