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23 Apr 10 More on the aftermath of the ATO change program

MEMBER 99 writes:

"Now assessment notices are coming back without refund cheques attached. One more issue for taxpayers to vent their anger at the meat in the sandwich – the long suffering and much maligned tax agent.

I think that at the very least the ATO must offer all tax agents and their families and staff an all expenses paid holiday to Vanuatu as compensation for the abuse we have suffered as a direct consequence of the ATO’s diabolically incompetent change program.

It will, of course, be a business trip, as we will all get the opportunity to study a tax haven at close range."


MEMBER 100 writes:

"I must now join the chorus of complaints about the ‘new system’.

Last week the assessments arrived - about 5 weeks from lodgment date- stating that the refund had been transferred by EFT to taxpayers’ nominated bank accounts, that’s OK but the returns did not have those details entered. I was about to ring the ATO when an email arrived to say that a mistake had occurred and a refund cheque would be sent out from 12 April 2010; however, nothing by today [16 April 2010]. Then the next day ATO phoned to apologise for this mistake, OK fair enough.

On Tuesday 13 April 2010 another batch of assessments arrived-5 weeks from lodgment date- this time the refund cheques have been applied to “your income tax account” - but none have an income tax amount owing to ATO; then, another email arrived to apologise for this error - apparently some 140,000 taxpayers’ refunds have suffered the same fate. What will it be next week??? – A request for an authority to transfer funds from the tax account to a refund account? It seems like individual taxpayers are now funding a reverse stimulus package, as a previous Member suggested.

The perpetrator of this system must now be stripped of his Purple Heart and then the ATO needs to find someone who can fix this, if is capable of being fixed.

My explanations to clients must be sounding a bit too glib – they stare in disbelief as the story unfolds, but it still doesn’t get them their refunds.

I hope the Taxation Institute is able to apply more pressure to get this resolved."


MEMBER 101 writes:

"I think Member 95 made a good point which is reflected in a lot of the Government failures and debacles of late. Who is to blame? Whose fault was it? Are the people in charge of implementing the new computer system in the ATO so incompetent that they didn't test it prior to implementation? Just imagine what would happen if this occurred in a similar sized business in the real world? The person responsible would undoubtedly be sacked for a stuff-up of the magnitude that has occurred in the ATO.

But will we see this anyone lose his/her job? Of course not. These are Government employees. There is absolutely no accountability for anything and, hey, it's not money from their pockets. It's only taxpayer's money - plenty more where that came from. And it will pay for stress leave and long lunches so the poor dears can recover from the trauma.

The people responsible for this disaster should not be put in charge of anything more complicated than running a bath, let alone running a multi-million dollar computer project. But they will probably be promoted to another area or stood down on full pay and entitlements for a little while, because that is the Government way."


MEMBER 102 writes:

"This "upgrade" should now be renamed "degrade" as a more accurate reflection of what has happened. Many are now starting to wonder if K Rudd has banished P Garrett to assist N Sherry in this debacle. Some may consider that delaying the refunds, but issuing the payable assessments, albeit with a shortened due date for payment, may somehow be the clawback scheme to get back the billions wasted on insulation schemes, stimulus packages and dodgy school building programs. I wonder how many of the computer geniuses at ATO have also had a hand in Queensland Health Dept payroll debacle. (For interstate readers QLD Health employees are receiving fortnightly pay slips with NIL earnings and NIL money and have been advised to visit charities for a handout.)

Get your act together ATO, and no matter whether the Henry Review recommends abolishing some tax returns, we know that each year tax gets more and more complicated and as an organisation the public do not trust you at all and never will. You need tax agents to be the intermediary but your latest efforts/ failures have now pushed any spirit of cooperation back to the low levels of the early 1990s."


MEMBER 103 writes:

"You can add another problem to the ATO's 'systems failures'. Since February when we lodge a Client Update form for a new client through ELS it turns out that the (ATO) system only adds us as agent for BAS purposes - we have to add the Income Tax role manually through the Portal. This is rather annoying as we have based our lodgment tracking system on ELS lodgments, so it means double work.

We have also had some inexplicable instances of existing clients who 'disappeared' from our Income Tax role. We picked that up only because we double checked tax return info from the client against Portal info before finalising a tax return.

I am not vindictive, but I think someone high up in the ATO should be held responsible for this mess and be sacked - as would happen in any normal business. These are not teething problems anymore, but utter incompetence in systems implementation."


MEMBER 104 writes:

"With so many of my colleagues writing in, lamenting the treatment by the ATO, I thought I would add my story of woe, and unbridled amusement.

I have a client who has developed a habit of lodging tax returns every 3 years!! Being employed in remote area locations is a contributing factor.

I lodged 2007, 2008 & 2009 tax forms on 11 March 2010. My estimates were for a refund in years 2007 & 2009, with a tax payable for the 2008 year. The refund for 2007 was more than the 2008 payable, and in total for 3 years, he was due a refund of a little over $2,000. I have read the stories from my cynical colleagues suggesting that debit assessments are rushed out, and refunds delayed !!  

Consider then, my mirth, when I received on 14 April 2010, an assessment notice for 2008, showing the debit assessment amount correctly calculated, with a due date. For all intents and purposes, my client would have received this notice, read it and paid the amount as requested.  

The other years’ assessment notices are nowhere to be seen.

But the statement of account received at the same time quite clearly shows that all 3 years returns have been processed, and shows the net refund due. But no cheque is yet to hand. The duplication of information on NoA and SoA is confusing at best, even for us ‘experts’, let alone the poor taxpayer who has no chance of understanding the paperwork. And when the 2 documents come in separate mailings, the cost increases are mind boggling.

I support all calls for a commission/investigation/review/interrogation into this farcical situation. An improved processing system should not have as many problems as has this change. Someone, probably many people, got things horribly wrong. As the situation drags on, with no solution in sight, and the question ‘who will pay’ (financially) becomes irrelevant, the ATO boffins need to be held accountable to the customers they serve...that is you and me.

It would only need for someone to offer me a reasonable price for my practice, and I will gladly retire early, just so that I no longer have to deal with an incompetent ‘simplified’ system."


MEMBER 105 writes:

"In his ATO website update of last night (16 April 2010) Second Commissioner David Butler provided ‘the facts’ about the ATO’s computer upgrade which included comments such as ‘the system is working well’ sitting beside comments saying that you and I (the Australian taxpayer) are paying for an extra 820 people to come in and fix the system that is working well.

He says the reasons for the delays are due to Centrelink, due to tax debts owing by taxpayers; due to people lodging multiple years of returns and finally due to taxpayers and presumably Tax Agents lodging returns full of errors – for some reason there is no mention of the delays being an ATO problem at all."

Then, in the Sydney Morning Herald of 20 April 2010, an ATO spokeswoman cited two examples of human error. ‘Notice of assessments and statements of accounts are linked,’ she said. 'They needed to be set to auto in the system, but they had been set to monthly, and that is why the cheques didn't go out with the notices of assessment. That was human error.''

The system that David Butler says is working well is still not working and the “Human Error” causing 140,000 cheques to not go out with assessments is still happening – today [20 April 2010] I received another assessment dated 15.4.10 but no statement of account and therefore no refund cheque – when will the “system” be set to AUTO to fix it?

PS I have received in the mail today (21 April 2010) a batch of Tax Accounts with refund cheques attached (all the ones we were sitting on assessment notices for).

The Returns were lodged 9 March 2010. The Cheques are dated three weeks ago – 29 March 2010.

Clients will get their money on 23 April 2010 – SIX weeks after lodgment. The ATO will no doubt not pay any interest because all cheques are dated 29 March 2010.

The 'system' is rubbish."


MEMBER 106 writes:

"Re the New Tax Assessment Notices. I have been a Tax Agent for 40 years, and seen some pretty silly changes in the ATO, but this time words fail me!"


MEMBER 107 writes:

"I have had a gut full of the ATO.

  • Still refunds owing from early January 2010.
  • Assessments with no refund cheques.
  • Staff on phone lines that have been with the ATO for 5 minutes and think they know everything – when we tell them something they do not know or say you cannot do this or that, then after talking to supervisors for 10 minutes they come back acting like they knew all along.
  • Receiving letters from Recovery demanding payment before the due date on the last ATO correspondence.
  • Amended assessments for 2 years with payment due for 2009 but missing refund for 2008.
  • Assessment for refund but no cheque, however in the mail the same date a letter for same client saying he has not kept to his payment arrangement (there was not one,  and never was) and demanding payment of $0 by June 2010.
And on and on it goes.

Why do we have bold new standards imposed on us when the ATO can do what it wants with no comeback? Where do I send the bill for my time, double handling refunds, handling incorrect ATO correspondence, handling clients queries and concerns caused by the ATO, training ATO staff, etc, etc?"


MEMBER 108 writes:

"I have just returned from the ICU at RPA Hospital in Sydney over the weekend having turned off life support to my beloved father on Friday afternoon and watched him die in my arms. I have returned to work today(Monday 19 April 2010) to more on-going blunders and mistakes from the ATO, more meaningless apologies and words of “we don’t know when this will be issued but we’re paying interest” – I have simply had a gutful of the ATO and it’s mouthings. I seriously at this vulnerable moment want to leave the industry and shake the dust from my feet as I leave and leave the ATO with nothing – not even my contempt!!!! They have made a very difficult time in my life that much harder by me being mentally concerned and distracted about my practice and its clients whilst sitting the death watch with my dad trying to comfort him and say the final things a son wishes to say to his only surviving parent. I can’t help but notice the contrast of the loving dedication and attention of the RPA ICU team of doctors and nurses and the soulless, couldn’t give a damn attitude of the monolithic ATO and its self-serving Media Releases."


MEMBER 109 writes:

"To all my fellow Members and the professional associations. Can we please start calling a spade a spade? In my 20 years of practicing tax I have never observed an ATO glitch that resulted in refunds being issued ahead of assessments to pay. Read between the lines, they are lying to you. I bet some public disservice jockey came up with an idea in planning the most recent disaster that if anything went wrong it would only be the refunds that are affected so everything at the ATO and Consolidated Revenue is fine and dandy.

Let me ask you this, do you think the ATO’s staff payroll cheques/deposits have been delayed? Not Likely.

So let’s get real. The ATO are not nice guys, they never have been. Heaven help you if you have to meet them in the courts. We need to apply adversarial pressure to them otherwise they will keep feeding us all the same BS as long as we are still there to listen to it.

I have found the best way to run my practice is to assume the ATO will stuff everything up and act to frustrate the intent of Parliament and so occasionally you are pleasantly surprised. Many thanks TAXVINE!!!"


MEMBER 110 writes:

"Regarding Member 97 in last week's TAXVINE – see 2010 TAXVINE No 14 16 April 2010. A possible explanation of why refund cheques are being deposited into clients’ bank accounts when this was not requested is, remember when clients received the extra $900 in 2009.

Thanks to Mr Rudd, well at that time the ATO was advising people to telephone them and give their bank account details. I was concerned about this at the time but the ATO assured me that this would have no effect on other tax refunds. Silly me I believed them at that time."


MEMBER 111 writes:

"We agree with all the comments of Members as to the ATO’s new computer system.  We see this bureaucratic mess (incompetence) being compounded day by day, fuelled by a PR machine and management who have no idea what is going on at the coal face.

A large number of our clients do not believe that it is the ATO’s fault, but believe that it is ours.

I feel that the ATO should advertise by way of a full page advertisement in each major Australian newspaper apologising for the incompetence and the hardship caused to taxpayers and accountants/tax agents. This advertisement should run each week until the matter has been totally resolved. Each Commissioner/Head of Department should be named and sign off on the advertisement.

Then Australia will know of the incompetent bureaucracy running the tax system!

Thanks for my say!”


MEMBER 112 writes:

“Dear TAXVINE

In relation to Member complaints regarding the ATO, perhaps the TAXVINE editor or an ATO representative could address some of the issues raised in the weekly Newsletter, in order to give a balanced view?

[TAXVINE comment: TAXVINE merely provides Members with a means by which their views may be published - we cannot provide a "balanced view". Nor, for that matter, have we received a single item of feedback complimenting the ATO on its new processing system. As to the ATO, they have not, after their initial response in 2010 TAXVINE No 6 (19 February 2010), sought to respond in TAXVINE to any of the recent feedback. However, the Taxation Institute, through its CEO, Noel Rowland, Senior Tax Counsel, Robert Jeremenko, and Tax Counsel, Angie Ananda, will continue to exert pressure on both the Government and the ATO until all the problems arising from the new processing system are fixed.]

Also, in relation to Member No 88's comment about receiving a notice of assessment for a balance of nil, it was my understanding that it is now established law that an assessment for nil is still an assessment, therefore requiring a statement of account. Perhaps you could confirm this with the ATO for the benefit of your TAXVINE readers?

On topics other than ongoing complaints about the ATO:

- is anybody at the Taxation Institute aware why Telstra treat their late payment fee as being GST-free? [TAXVINE comment: American Express International Inc v FCT [2009] FCA 683 (Federal Court, Emmett J, 19 June 2009) may provide the answer.]

- in relation to the ATO's recent advice that mini ciabata bread is taxable for GST purposes, does that mean that mini bread rolls will be taxable now as well?

- finally, the State of Queensland has already foregone a significant share of its slice of the Federal GST pie and it shouldn't be asked to do so again, in order to fund an ailing health system.

Well TAXVINE, hopefully these comments will stir up some debate on topics other than the lacklustre ATO administration system."

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