03 Sep 1010 Warning - YTD Interest Summary for 2009/10MEMBER 275 writes:
"For 2009/10, the report is a mixture of accrual & cash accounting within the particular client's account.
The 'Total Net Deductible Interest Expense' relates to only BAS & Income Tax Returns for year ended 30 June 2010 (accrual basis) but 'Total Net Assessable Interest Income' was the full amount remitted regardless of which year the remitted CIG related to (cash basis).
I believe the ATO is in error - either both amounts should be accrual or both amounts cash basis - not a mixture of each.
In my client's case, 'she who must be obeyed' decreed that all his tax affairs be put in order. This resulted in a total GIC of $14,500 for multiple year's returns & BASs. This was charged in April 2010 & fully remitted in June 2010.
Yet the YTD Interest Summary Report 2009/10 says that the full $14,500 is assessable at Item 24Y but only $3,500 (which relates to 2009/10) was deductible at Item D10.
The Pre-filling Report for the client confirms the above amounts.
What is even scarier is if the GIC of $14,500 was imposed on 30 June but remitted on 1 July. In that scenario, accrual accounting would be the fairest. $14,500 in different years would be a huge disadvantage to his tax & Centrelink situations."