In the ATO’s most recent tax professional webcast, a viewer posed the statement: “Agents lodging incorrect claims should be weeded out.” In response, one of the panel, Assistant Commissioner Kath Anderson, agreed that it is in everybody’s best interests to have a level playing field, but added, referring to practitioners, not their clients: “We need to make sure those who are doing the right thing are not at a disadvantage from those who choose to do the wrong thing.”
To help those doing the right thing, she concludes that the ATO needs to have less complexity in its advice and compliance. “We have new guides coming out this year, and we are revising them,” she said. “There are more coming out this year, so there will be more occupations that have some help. We are also looking at how we can target specific work-related labels — things like car and laundry, just to help people get it right.”
From a compliance perspective, Anderson candidly stated that the ATO has seen a lot of mistakes from agents. “We will be talking about their risk profile,” she said. “This is where we look at the claims they are making across their client base paired with claims made by other clients.” Anderson said the ATO will be talking to these tax agents about how they can change their practices to get things right.
But there was also a warning. “For those who are intentionally engaging in reckless and egregious behaviour, and creating unfair advantage for themselves, we will be taking more action to make sure there are consequences for them, including personal consequences.”
She explained this last statement in this way: “We’ll not only be looking at their client base but their personal affairs, and those in their practice. We need to make sure people are stopped from doing this.”
Anderson said the ATO wants people to claim what they are entitled to and no more, no less, but also knows that the ATO continues to rely on agents to help it out, to engage with their clients, and to educate them.
“We know most agents are doing that, but we are also heavily reliant on agents to be doing those checks to make sure that work-related expense claims have been incurred and haven’t been reimbursed, and secondly that they are related to earning income, and that there are records to prove it.”
Anderson said the three elements mentioned above — the expense has been incurred but not reimbursed, it is related to earning income, and there are records should they be required — are what could be called the three golden rules of work-related expense claims. “We do rely heavily on agents to make sure that with respect to claims they are making with their clients that they are making sure they have complied with those three rules.”
The full panel of the ATO tax professionals webcast, which was hosted by the ATO’s Assistant Director Vlad Dugandzic, also included Assistant Commissioner Andrew Watson, Institute of Certified Bookkeepers CEO Amanda Linton, and Assistant Commissioner in the Tax Practitioner Lodgment Strategy and Compliance Support Group Colin Walker. To see the full webcast, click here.
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