Fricken' ATO

[silentC]

Those of you lucky enough to have a PTY LTD that predates the GST will know about the Deferred Tax Instalments, or what the ATO refers to as 'deferred coin'. When the GST came in, companies were given the option of deferring their 1999-2000 tax debt and paying it off over 5 years interest free. This was because they were changing from yearly to quarterly payments. We chose to defer it.

Recently, we decided to wind up our company. I called the ATO to ask for a payout figure. They told me $590, representing 2 deferred payments of $295 each. We sent them a cheque for that amount and assumed that was it. Four weeks later, we received a statement stating that we owed $2065 and had two weeks to pay it or there would be an interest charge.

Slightly miffed, I contacted the ATO to find out where the $2065 had come from, since we'd been told that $590 would settle the debt. Nobody could explain it, so I lodged a complaint. Today they called me and explained how their system works.

What they do is they post an amount to your 'Integrated Client Account' each quarter representing the deferred payment. So immediately after you make a payment, your 'balance' is zero but then 3 months later they post another amount (in our case $295), giving you 2 weeks to pay it or there is an interest charge. The people on the account enquiries line do not have access to your 'deferred balance' so when they look at your account balance, they only see the amounts that have been posted.

When we told them by letter that we were winding up the company, they posted all the remaining deferred payments to our account, hence the sudden $2065 balance and two weeks to pay. I explained to the nice lady that this was not necessarily clear to the average man or woman on the street and that, when one rings to get a payout figure, one expects to be given the actual outstanding amount. Apparently it is all my fault because I did not ask the right question. I introduced the term 'reasonable person' to the conversation but that cut no cheese with her. We argued around in circles for awhile but she eventually agreed to 'escalate' the issue for possible revision of help desk scripts. I wont hold my breath.

So let this be a warning to you. The ATO is not always forth coming with full and complete information. Do not believe ANYTHING they tell you. You can assume that they will come to you with their hand out at anytime down the track. I asked her how could I be sure that there wont be anything else lurking to bite us on the bum and her reply could be paraphrased to 'you cannot'.

Fricken' ATO

[bitingmidge]

Have I moaned about the GST audit we are currently going through?

We have no issue with our innocence BUT the audit relates only to the sale of a business which was settled about five minutes after GST was introduced, and owned by a company which we wound up three years ago.

GST is only applicable in this case to stock in hand, which at a worst case could only have been $2500 or $250.00 worth of GST. So to ensure that we haven't made an arithmetic error and only paid $248.00 (or whatever) we have now got a torch shining fair up our culdesacs.

Don't get me wrong...paying tax is fine...audits are OK as well if they are adopted on reasonable grounds and have a chance of catching a cheat. (Cheats cost you and I more tax in the long run).

So far about $2,000 in solicitors and accountants services, and a definite NO to my offer to just pay them another $250 to save me the effort!

Yes I did have audit insurance, but of course that was when the business was operating!

Wonder what the prison sentence is for overpaying GST by $2.00 ?



P

[silentC]

You should get your story on Today Tonight! Naomi loves those sort of stories

[bitingmidge]

You should get your story on Today Tonight! Naomi loves those sort of stories

You first..... I'm still scared from when I took 'em on in '82.

I was wrongly assessed and sent a bill for $30grand THEIR MISTAKE (more than I earnt in a year), the Act says you have to pay, then fight...I couldn't so just fought...FOR TWO YEARS.....won....then two days later got a bill for $6grand being interest on the money that I didn't owe anyone but should have given them a loan of while we were arguing about it. Somebody in the ATO obviously decided I was a nasty person.

I won that too eventually, but was on their bad boys list for years and it probably gives a pretty clear idea why I have a somewhat less than sympathetic view of SOME Tax guys.


Oh, then there was the 1987 Audit of our business - turned over $2m the previous year and after TWO MONTHS work they found a contractor whom they deemed to be an employee and we were fined $125 for failing to deduct PAYE of.......drum roll............$18.00. Hope they got their productivity bonus that year..another kill!

I'm going off to write stuff about chook poo now..........

:mad: :mad: :mad:

P

[jackiew]

and whatever you do ... don't necessarily believe anything that they tell you when you phone up their help lines ... check it first. I've got no idea how they train these people but as far as I can work out they will often tell you anything that will make you get off of the line.

last year went specially to a local shopping centre where an ATO help desk was advertised as being set up as I had some specific questions. The two young men manning the desk looked totally horrified when I asked them for some information rather than just wanting a tax pack.

Their answer to one of the questions was basically just don't mention it on the tax form because we'll never find out about it anyway!!!! :eek:

For one of the other questions they gave me a number to ring ... i then spent a happy time being passed from person to person none of whom would admit to knowing anything about the issue of interest.

I don't think it unreasonable that someone who supposedly works for a bit of the ATO which deals with forthcoming legislation ( as discussed in the Senate no less ) should be able to at least look up the existing legislation ( I knew what they were changing it to ... but I wasn't sure of one of the details of what they were changing it from!).

My experience of accountants since I've been in Oz is that they don't want to know if your affairs are anything other than totally straightforward and even then they don't really care if what they are claiming has any relationship to the true state of your financial affairs. After all it is you the individual who has ultimate responsibility for your tax affairs ... the tax adviser is quite free to stuff up and walk away.

As a result I've become quite expert in navigating the ATO site. Fortunately my lateral thinking skills are quite good because even if you know the information is there it can be a bugger to find. I make sure that if I can't find something easily I let them know.

end of rant ... and I haven't even started on my 2003-2004 tax return yet.

[silentC]

I'm going off to write stuff about chook poo now

A task for which you seem admirably qualified, owing to the number of times you've run fowl of the Tax Office

[Sturdee]

Darren,

When I was working I had the unfortunate experience of working for 3 separate employers who were audited by the ATO.

The first audit was done by an arrogant B******** who liked to throw his weight around. Although I could not refuse him access to our records I fixed him up, on legal advice, by refusing to turn on the lights in our record room or provide a desk to work on. It was a sight to behold watching him work by torchlight sitting on the floor writing out copies of documents.

The second one was a betterment assesment and we had to prove they were wrong, after 3 years of arguments we settled for $ 10,000 instead of the $ 200,000 originally claimed.

The final one was a relative simple one, nice staff and an easy negotiated settlement.


The only advice I would give is always do all your dealing with the ATO in writing (and after an personal interview sent a letter to them confirming the discussions) and always do an objection on the broadest grounds and include in your objection that the Tax Assesments Acts are unconstitutional. It is my experience that they do not want that aspect tested in a court and are much more ameliable to a settlement.


Peter.
BTW - I used to charge handsomely for that advice.

[Barry_White]

I think all tax people are an inbred breed of people that should not be associated with even socially.

A few years ago at an end of year party one of the ladys from work brought here husband along who worked for the local tax office.

A truck driver was having a conversation with another person about earnings and this inbred tax person was eaves dropping on the conversation.

The upshot was the truck driver was tax audited within a week of the conversation.

[ozwinner]

Last year I was sent a bill from the ATO for $644, I paid it straight away.

One week later I received a cheque for............you guessed it.............$644.
This year they sent me a bill for $644, plus interest. :mad:
What the....................
I am sure there is a bunch of monkeys running riot in the ATO, running and jumping all over the keyboards.
How else could a human make such a stupid mistake twice.
Nah, its got to be monkeys for sure.
Their excuse to my accountant was, that they couldnt process the first payment properly.

Yep, monkeys.

Cheers, Monkey man