For some, expecting your tax return can feel as though it drags out for weeks. After all, the ATO (Australian Taxation Office) is very quick to take your money and you want your refund back! It’s totally understandable. It’s also a question we hear often, however there are a range of reasons why your tax return might have been held up by the ATO.
Pro Tax Tip: It’s important to note that if you have contacted the ATO about your late tax return, you may receive an email or SMS to let you know if your tax return has been delayed and why, or when your refund is on its way. The ATO will NEVER ask you to reply to that SMS or email, or provide personal information such as your bank details or Tax File Number (TFN). Many tax scams start up when it’s tax time. If you need to correspond with the ATO, it’s best to use a trusted tax agent to avoid being the victim of a tax scam.
In most cases, documents lodged with the ATO online (including tax returns, refunds of franking credits and non-lodgement advice) should generally be finalised within 10 business days. Paper forms can take up to 50 business days (10 weeks). Some tax returns requiring a manual check can take longer.
The quickest and easiest way to track your tax return is to contact your ITP Tax Accountant. They liaise with the ATO on your behalf and can find out the progress of your tax return and if there is a reason for it to be taking longer than the normal time. Tax returns can be checked for the current year and for prior financial years.
There are several stages your tax return progresses through:
|In progress – Processing||The ATO has received your return and has started processing it, or they have finalised your tax return and are issuing a notice of assessment. You can access an estimated assessment issue date.|
|In progress – Information pending||The ATO is collecting information to help finishing your tax return. You will be contacted if they need more information.|
|In progress – Under review||The ATO are manually reviewing your tax return and double checking all details before they finalise it. They may be reviewing previous year’s tax returns and will contact you if they need more information.|
|In progress – Balancing account||The ATO is balancing the result of your tax return with your accounts and other Australian Government Agencies, and calculating your refund or tax bill. They will contact you if they need more information.|
|Issued – $ Amount||The ATO will have sent your notice of assessment with the effective date for payment if you’re entitled to a refund.|
Pro Tax Tip: Make sure your bank details are up to date. Tax refunds are paid directly into your nominated bank account. It’s important to check you have the right one listed and that the branch and account numbers are correct.
If you’re entitled to a refund, the effective date is usually the date that the ATO sends your refund to your nominated financial institution. Check with your nominated account to see how long it takes for the amount to be deposited. It may take a couple of days. If you have a tax bill, the effective date will be the date your payment is due.
Why Is My Tax Return Delayed?
Some tax refunds take longer than the normal 10 business days. The ATO processes a lot of tax returns in a small amount of time, and there are reasons for delay:
- You only need to lodge your tax return once. If you have tried to lodge your tax return again after previously lodging, it will delay the processing time as details will be manually checked. If you have information that needs to be adjusted, do not lodge another tax return. Your ITP Tax Accountant will amend your tax return for you if required
- If you’ve made an amendment before the ATO has finalised your original tax return or any previously lodged amendments, you will delay the processing time
- You have lodged several years tax returns at once
- You might have had a tax debt or unresolved debt with the ATO
- You are under insolvency administration, which includes bank or debt arrangement. Your insolvency advisor will advise your situation to the ATO before you lodge your tax return
- Your nominated financial institution details are not current
- The ATO might be checking some details on your tax return. They will manually contact your employer, financial institution, private health insurer or manually cross check information you have supplied
- The ATO will also manually check information with other Australian Government agencies, such as Services Australia, Centrelink and Child Support for any outstanding amounts
Pro Tax Tip: If you’re suffering financial hardship, your ITP Tax Accountant can liaise with the ATO and request a priority processing of your tax return.
Once your tax return has been processed, the ATO will issue a notice of assessment and let you know if you’re entitled to a refund or if you have extra to pay.
I Need To Amend My Tax Return
You may have jumped the gun or you may have simply forgotten some details and already lodged your tax return. You can amend your details, but you will need to wait until you have received notification that your original tax return or any previously lodged amendments have been processed. You’ll need to make sure you have received your most recent notice of assessment before you amend information as this will help reduce the number of processing days. Online amendments are usually processed within four weeks and up to 10 weeks for amendments made in writing.
You’ll need to send in your amended details within two years from lodging your original tax return.
Are You ‘Tax Ready’
Before you can lodge your tax return, you’ll need to finalise your total assessable income for the financial year. Your employer will report your final PAYG and superannuation details directly to the ATO. Your employer has until the 14 July to finalise your details and provide you with an income statement. If you have more than one employer, you may receive both an income statement and a payment summary. Banks, health funds and government agencies have until the 31 July to finalise your details.
Your tax agent can access your income statement or payment summary information and inform you if they have all the details in order to claim your deductions and lodge your tax return. You will need to be ‘Tax Ready’ in order for your tax agent to process your tax return. It is important that you don’t use any information that is not marked ‘Tax ready’ as your employer may finalise your income statement with different amounts which means you may have to amend your tax return.
If after 31 July your income statement is not marked as ‘Tax ready’, you’ll need to speak to your employer to find out when they will finalise your statement.
Pro Tax Tip: Private health insurers are no longer required to provide statements to their members. Previously, your health insurer was required to send a private health insurance statement to each adult covered in your policy by 15 July. It is now optional for them to send this to you. Your ITP Tax Accountant has access to this information. If they don’t have access to this information, you’ll need to contact your private health insurer for your statement.
ITP understands you’re anxious to receive your much needed tax return and will advise if they have all your required details and claim your deductions before they lodge your tax return and streamline the process for you. Using a tax agent gives you peace of mind, knowing your tax return won’t be flagged and you’ll receive your tax return in the shortest possible time. They also have the added benefit of liaising with the ATO directly on your behalf if things have been held up.
ITP Accounting Professionals have helped Australian Individual and businesses for 50 years to make the most out of tax time. Speak with an ITP tax agent today and see how they can help your small business.