5 ways business owners can accidentally trigger a tax audit
It all starts with a notice from the ATO You are busy running your business, juggling the day-to-day and keeping busy with customers, employees and back-end work. Out of the blue, you receive a letter from the ATO telling you that an audit of your company and business operations has been completed. At the end of the letter, you find a full-course […]
Respond to a Director Penalty Notice
Respond to a Director Penalty Notice A company tax debt has just become your debt, and the clock is running. The notice in your hand moves your company’s unpaid PAYG, GST or superannuation onto you personally. Which of your options survive depends on the type of notice and on 21 days that started running when […]
Challenge an ATO decision
Challenge an ATO decision An ATO decision stands until someone displaces it, and that someone is you. A notice has arrived from the ATO with a number on it you don’t accept. Disagreeing isn’t enough on its own: an assessment is treated as correct until you show that it isn’t, inside a window that is […]
Respond to an ATO review or audit
Respond to an ATO review or audit The ATO is asking you to account for decisions you made years ago. Four years ago you and your accountant treated a transaction a particular way. A letter has now arrived asking you to explain it, and what you can show is whatever you happened to keep at […]
When should directors be personally liable for tax debts?
As a general rule, a company provides its shareholders with ‘limited liability’. This means that the extent of resources a shareholder risks when they invest in an enterprise is limited to the amount of capital they put into the company (or agree to put in). If the company runs out of resources, or gets hit with a nasty surprise, the capital may all be lost, but the shareholders are not obliged to put anything additional in. They have just ‘done their doe’.
The limitation of liability for shareholders has not really changed much over the centuries that limited liability companies have been around. What has changed, is the role and responsibility of directors.
Four ways to challenge Director Penalty Notices
The ATO is using Director Penalty Notices more often. However, the ATO officers are only human and they can make mistakes. There are four main ways in which your DPN may be challenged.
ATO discrimination – plain and simple
Will all business owners be required to return profits from their businesses as personal services income if they are involved in the business? Will they be required to earn a ‘market wage” (whatever that is)?
Having an argument with the Tax Office?
We have extensive experience in dealing with the Tax Office and helping clients find a way through their taxation issues.
Podcast: Dealing with the Tax Man
Hear Andrew Andreyev on ABC Radio 891 Drive-time in Adelaide discuss what to do when you disagree with the Tax Man.