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05 Aug 11 On the ATO's delay in processing client tax return

MEMBER 135 writes:

"I have had a frustrating time dealing with the ATO delay of a client's return, with a refund over $5,000 due to working as an employee for only six months of the tax year.

Extract from ATO letter: 'We are writing to let you know that we are contacting selected taxpayers whose return will be reviewed, as it has been identified as containing some information we want to further investigate prior to issuing an assessment...We are using specialist technology to help us identify and review returns which may contain missing and or/incorrect information...As a result of this, we will hold your client's return until our investigations are finalised. We anticipate these returns are likely to be delayed for a minimum of 12 weeks.'

My client's return contained 2 payment summaries, interest, dividends (small parcels of Telstra/AMP), $500 total tax deductions and no offsets. The first two ATO officers could offer no assistance. The third ATO officer I spoke to explained that my client’s return had been targeted because of the $296 of franking credit claimed as this had been an area of increased fraud. $296! Are they serious? Do other members think this justifies holding up a refund for a minimum of 12 weeks? How do I explain this to my client of 15 years?"

The Tax Institute's Tax Counsel Tamera Lang comments:

We have brought this case to the attention of the ATO and they are currently investigating why such a long time frame was given for a pre-assessment review. We thank the member for bringing this issue to our attention, and encourage other members who are experiencing issues during TaxTime to contact us.


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