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05 Apr 12 On CGT and data matching

MEMBER 79 writes:

“I don’t want to flog this one too much, but this process must be the most appalling piece of administration the ATO has undertaken in my 20-plus years in the profession. My client received a notice about a property, notwithstanding that the property was her main residence and tax return address for around 15 years, advising we could respond within 28 days. I responded within 7. Nonetheless, when I checked the portal on the 29th day (having of course heard nothing), her account was $66,000 in debit as a result. When I rang the ATO, they admitted that my letter had not been actioned. Interestingly, I was told she was selected because she had an ABN. Obviously anyone with an ABN who sells a property that is clearly their own home must be up for CGT on 100% of the gain, particularly when their annual business income was almost $3,000. The officer then asked some main residence questions, which were answered, after which I was advised the debit would be cancelled. Why weren’t these questions asked before the assessment was raised? If a commercial organisation had conducted a process in the same manner, culminating in a $66,000 bill to a consumer, its directors would be in jail.”

THE TAX INSTITUTE’S TAX COUNSEL, STEPHANIE CAREDES, COMMENTS: “As noted in last week’s 2012 TaxVine No. 10, we are aware that some of our members are experiencing similar issues and we will be raising it at the next ATO Tax Practitioners Forum in May. We will report back to members in due course.”

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