Tax audits are an in-depth examination to verify the accuracy of information reported to the Australian Tax Office (ATO) or other Authority. Each year, the ATO continues to announce increases in their audit activity as they target “dodgy” and inconsistent claims. Earnings from cryptocurrencies, ride-share apps and work-related expenses such as fuel and dry cleaning will be closely analysed, as well as investment property deduction as the ATO moves to clarify returns that don’t quite add up.
Whether you are a business or an individual, there are a number of reasons that could trigger an audit from the ATO. These include:
· Not declaring capital gains on property or shares
· Undeclared foreign income
· Undeclared interest earnt on bank accounts
· Undeclared earnings from your small business
· Claiming for deductions you’re not entitled for
· Having a lifestyle that does not match your income
· Claiming for deductions related to rental properties, without proof of rent
Hundreds of thousands of Australians received letters from the ATO in 2018 that were flagged as unusual or were discovered to have undeclared income, and it is expected that this number will climb again in 2019.
What is Tax Audit Insurance?
Tax Audit Insurance protects you and your business from the cost of an unexpected audit. When you or your business is audited, documents detailing company structures, ownership entities, financial flows, asset acquisitions and more may need to be compiled. Explanatory notes and detailed calculations might be required to support claimed deductions, and legal interpretations and justifications may also need to be provided. This is not only time-consuming, but often requires the services of professionals such as accountants and lawyers, and can cost thousands of dollars. Tax Audit Insurance helps you stay in control financially, by making sure you’re not out of pocket when engaging with accountants and other professionals when an audit occurs.
How can I purchase Tax Audit Insurance?
We have partnered with Guild Insurance to offer all our clients a comprehensive Tax Audit Insurance policy with a competitive premium. As a 100% Australian owned insurer, you can
trust that you’ll be supported by a team of specialists that understand the Australian tax system.
The Guild Tax Audit policy provides cover for Professional Fees incurred when responding to an audit of:
· Income Tax
· Capital Gains Tax
· Land and Payroll Tax
· BAS/GST Compliance
· Workers Compensation/WorkCover
· Self-Managed Superannuation Funds
· Fringe Benefits Tax
· Stamp Duty
The key benefits of the policy include:
· Choose the level of cover you need
· Premium based on the complexity of your tax situation
· Free pay by the month
· 24/7 claims support
· No excess
For more information on Tax Audit cover contact Guild Insurance on 1800 810 213 or visit guildinsurance.com.au/professional/tax-audit.
Insurance issued by Guild Insurance Ltd, ABN 55 004 538 863, AFSL 233791 and subject to terms, conditions and exclusions. Refer to the Product Disclosure Statement (PDS) and policy before you make a decision about an insurance product. You can get a copy of the PDS by calling 1800 810 213.