12 Sep 1414
On the incorrect Medicare levy surcharge calculations
MEMBER 135 writes:
"One of my clients received an assessment showing taxable income of $X. The client also had Reportable Fringe Benefits disclosed in their return.
The paragraph at the bottom of the assessment says the ATO takes into account (amongst other things) any reportable fringe benefits in determining “your rate” for the Medicare levy surcharge but then ignores that figure in levying the surcharge. The assessment states that it has calculated the Medicare Levy Surcharge as 1% of "your taxable income". In other words, the computer has been programmed to just take 1% of “taxable income” instead of taxable income plus reportable fringe benefits [see ATO website here].
Of course you try to ring the Tax Practitioner area and let them know they are missing out on millions but 'we can’t do anything from here - you’ll have to lodge an Amended Return or an Objection'.
Sorry no time for that – I gave you the information and you ignored it."