21 Nov 14
On "final" assessments - the ATO responds
In 2014 TAXVINE No 42 (14 November 2014), Member 182 wrote about the change in the ATO's practice of treating the final assessment clearance (and after reasonable enquiry of other debts and obligations) as being the end of a deceased taxpayer’s ATO obligations, citing, as an example , a situation where, twelve months after an estate was distributed (and assessments issued), the ATO then advised that excess contributions were made 3 years ago and that there would be an excess non-concessional contribution assessment issued.
THE ATO NOW RESPONDS
"There is a draft Law Administration Practice Statement (PS LA) currently being reviewed by the ATO in respect to deceased estates to replace Chapter 32 of the ATO Receivables Policy which will be published early next year.
A trustee may rely on a notice of assessment for the date of death return as a statement of the deceased person’s final income tax liability for the purposes of asset distribution, but only to the extent that no amendment of any assessments could be reasonably anticipated. The trustee should make enquiries to the ATO to determine the extent of any tax-related liability which may be raised by the issue of any notices of assessment or otherwise.
In circumstances where the trustee had no reason to suspect that further assessments might issue, the requirements of advertising have been satisfied and the assets fully distributed, then it is unlikely that the Commissioner would seek to recover any of the outstanding tax."