How to amend your tax return
If you find a mistake after your tax return forms have been lodged and assessed, there's an easy way to ask the ATO to fix it.
Although you likely checked and then double checked your tax forms before lodging them with the ATO, there are times when an error is noted afterwards. This may be your error, a tax preparer’s error, or a mistake made by the ATO. If you do find a mistake, you have two years from the time your tax forms were assessed to bring it to the attention of the ATO. This is done by requesting an amendment either for a mistake or an omission.
How to request an amendment on a tax return
You can use the form provided by the ATO to request an amendment. Make sure that it is filled out in its entirety and signed by you before you send it to the ATO office. A registered tax agent can also make the request on your behalf, provided that they have your expressed permission to do so. It is also important to note that even if you used myGov to lodge your tax return with the ATO the amendment request must be done in writing.
If you decide not to use the form provided by the ATO you will have to supply them with a detailed letter that includes all of the following information:
- Your tax file number (TFN)
- Your full name as it appears on your tax records
- Your postal address
- A daytime phone number where you can be reached if additional information is required
- The tax year for the tax return that you are requesting be amended
- The item number on the tax form that the amendment pertains to and a detailed description of the change
- The exact monetary amount of the change, whether it be in your income or deductions
- The exact amount of tax offsets that need to be increased or decreased
- If available, the claim type code
- An explanation of how the mistake was made, and a reason for the change
- A declaration signed and dated by you that states:
- I declare that all the information I have given in this letter, including any attachments, is true and correct
- I have the necessary receipts and/or records to support my claims for amendment
Do I need to tell the ATO I made a mistake?
The short answer is, yes. If you voluntarily disclose an error made on your tax return to the ATO and it results in you owing more money, you will receive concessional treatment and not have to pay any penalty or interest. If the mistake is in your favour, you could be entitled to an additional refund which will be paid to you. If you do not disclose a mistake that was made and the ATO discovers it, you could face additional financial charges.
What are the time limits on amendment requests?
It is important that you amend a tax return as quickly as possible after realising a mistake has been made in order to avoid penalties. You can request an amendment by using the form on the ATO website. Once filled out you can print it and either send it by fax or mail to the ATO.
For individual taxpayers and small businesses, the time limit to request an amendment on your Australian tax form is two years following the date of assessment. After that time period you would have to lodge an objection, which allows for extensions under certain circumstances.
How does the ATO process my amendment?
Just as the ATO accepts your return at face value in most cases, it also accepts your amendment request. How long before the adjustment is made will depend on the nature of the error. If you made a mistake in reporting your income or deduction, it could take up to 50 days to process or 20 if sent to the ATO by a tax agent. If the mistake was made by the ATO then the processing time is 14 days.
There may be situations where additional information is needed. In those cases the ATO will ask for that information within 14 days of receiving the request. If they are still unable to process the request within the normal time frame, they will contact you to give you a new expected completion date.
If money is owed to you as a result of the amendment, the ATO will pay you, including any interest. If you owe money, you will receive notice of an amended assessment with the amount due and due date. This may also include interest owed by you, which you can request be removed as you are the one who brought the error to the attention of the ATO.
If your Australian tax return had not yet been processed when the request for amendment was received, they will be processed jointly and you will only receive your notice of assessment, without a notice of amended assessment.
While it may seem easier to just ignore a found mistake, this could cause you problems with the ATO in the future. The process of asking for an amendment is fairly straightforward, with little chance of being penalised for your mistake. If you follow the correct procedure, you will be able to rest easy knowing that all of your tax affairs have been put in order.
DISCLAIMER: Many of the comments in this article are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information applicability to their own particular circumstances.
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