If you earn a salary, you probably need to lodge a tax return every year. Even if your employer deducts some taxes as you receive payment, it is still necessary to lodge tax returns especially if you have additional sources of income. Lodging tax returns is also important because, in some cases, you can claim back certain work-related expenses. There are many reasons that can make you miss the deadline to lodge your tax returns. Perhaps you have been extremely busy or overseas, or income and health-related issues prevented you from lodging in time. Many people often don't know what to do in such situations. If you are one of these people, here is what you need to know.
Penalties
If you miss the deadline, it is important that you make an effort to lodge the tax returns as soon as possible. That's because penalties for your failure to lodge the tax returns on time may apply. These penalties will accumulate the longer you wait and may add up to hundreds of dollars.
However, the government office responsible for tax collection sometimes offers waivers on select cases of late tax lodgement. Generally, penalties may apply if you have a poor history of tax lodgement, if you have multiple outstanding tax returns, or if you have a history of non-compliance with other tax-related matters. Nevertheless, the tax office will notify you concerning your late lodgement. You will also be notified if any penalties will be applied. The notification may be in writing or by phone. In the case where penalties are applied, you will receive a notice concerning the penalty amount as well as the due date. This is a time within which you can catch up on your late tax returns.
Ability to Pay
You may lack the money to pay the overdue tax perhaps due to a significant change in your income such as the loss of a job. In such cases, you need to be as honest as possible about your reasons for failing to lodge your tax returns. The tax office will always be willing to listen to your reasons, and you may get a remission of not only the penalties but also the interest you are charged. You can also consult a taxation lawyer who can negotiate a favourable payment plan, a reduction or even a total release of the tax debt. Reach out to local tax accountants to learn more.
