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07 Sep 1212 More on FTB being used to offset tax liabilities

MEMBER 182 responds to Member 181's feedback in last week's TAXVINE - see 2012 TAXVINE No 33 (31 August 2012) - about Family Tax Benefit payments being appropriated to offset tax liabilities not yet due for payment:

"I have now received 2 assessments that are in the same vein as Member 181. The payable assessment should not be due until March next year, yet the taxpayer has had money taken from their Family Assistance Office account... Perhaps the Commissioner should lodge his return now and have his balance payable taken from his bank account without warning!! This is a disgrace. What compensation arrangements are now going to be offered by the ATO? I suggest the highest bank overdraw charge plus interest and the family assistance balance plus a sincere apology is warranted ASAP. And then we get asked to assist following up lodgments of overdue taxpayers. Stop penalising early lodgers and wasting our time explaining the ATO's illegal actions and we might have a chance to get overdue lodgers up to date."

MEMBER 183 also writes on the same subject:

"Further to Member 181's comments last week, I would also like to know why the ATO is taking this approach. A client of our practice has had a little over $3,400 transferred from her Family Tax Benefit entitlement to offset her tax debt due 21 March 2013.

We thought we would lodge the return early so that the client could get their family tax benefit and the thought was to put aside $3,400 into their mortgage offset account for 6 months, thus saving some interest.

The other interesting point to this is the ATO still issue the notice of assessment showing the debt is outstanding."

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