EMAIL

Ph: 0438 780 633
PO Box 406
Wangaratta Vic 3676
 ross@guardianaccounting.com 

Engagement Terms

Thank you for your instructions to attend to the accounting and taxation requirements for your family members and associated corporate and trustee entities, where applicable, (The Group).  I would like to take this opportunity to welcome you to Guardian Accounting and I look forward to a long association as your accountant.  If you ever have a query about any aspect of your accounting and taxation affairs please don’t hesitate to contact me.

As part of our professional standards requirements and the Tax Agents’ Legislation we are taking this opportunity to set out our terms of engagement with you.   This letter sets out our terms of engagement and supersedes any previous engagement letter provided by us.  Please read it and make sure that you understand the scope of our engagement.

If the terms of our engagement are acceptable, please continue with your engagement with us.  Please contact this office immediately if you do not understand, or wish to discuss, any aspect of the terms of this engagement.

If you do not contact us with changes to the engagement, yet continue to provide us with information and instructions regarding your financial and taxation affairs, the terms and information provided in this document will bind us both.


Purpose and scope of engagement

Our engagement may be to attend to the following matters:

·         carry out the business bookkeeping on a monthly basis and reconcile relevant accounts;

·         prepare & lodge your employee PAYG Payment Summaries, including lodgement of Single Touch Payroll reports;

·         prepare & lodge your annual workcover return;

·         act as the Registered ASIC Agent & registered address for your corporate entities;

·         prepare and lodge the Business Activity Statements for “the Group”;

·         prepare the annual financial statements for “the Group”;

·         prepare and lodge the annual income tax returns for “the Group”;

·         prepare and lodge the annual FBT returns for “the Group”; and

·         prepare and lodge the superannuation accounts and tax return for your Self Managed Superannuation Fund.

Unless otherwise agreed, we will prepare the above returns and statements on an ongoing basis, in relation to the period following that for which the returns and statements have most recently been finalised, and for each subsequent period.

Each member of “the Group” engages us on the terms set out in this letter and is bound by those terms.

Those persons are jointly and severally liable to pay our accounts, regardless of which Group member those accounts are addressed to, and regardless of which Group member received the benefit of the work performed.

If we are asked to act for a new or additional member of your family group, we may forward to you an updated Schedule of Clients which each existing Group member agrees will apply in place of any previous Schedule of Clients.  We will also require the new Group member to acknowledge these terms of engagement.

We have not and will not provide ‘Financial Product Advice’ as defined by the Corporations Act. We are not licensed to provide financial product advice and taxation is only one of the matters that you need to consider when making a decision on a financial product. You should consider seeking advice from an Australian Financial Services Licensee before making any decisions in relation to a financial product.

Our services will be provided to you on a fee for service basis.

Fees for undertaking the services outlined in this engagement will be generally invoiced upon completion of the particular service and terms of the invoice will be no longer than Net within 7 days.   If you would prefer a quote or fixed price agreement please contact us prior to our commencement of any task. If we believe that the time taken to complete a particular service will be longer than usual, then we reserve the right to invoice the work in progress as it occurs.   Each year on 1 July we will adjust our fees with reference to the most recent annual  Consumer Price Index. You will be notified in advance of any additional variation to fees charged.

This document relates only to the abovementioned services and details the basis and terms of this engagement.

Basis of engagement

As previously discussed, our engagement is to assist with the preparation of the financial accounts and the preparation and lodgement of the taxation requirements of “the Group”.  

Accounting & record keeping

In undertaking this engagement, it is understood that you will generally ensure that:

·         the bookkeeping for all business entities is maintained on a regular basis.  In fact, we recommend the bookkeeping and record-keeping tasks be attended to each week;

·         reconciliations for bank accounts, debtors and creditors are performed at the end of each month for each of the business entities;

·         a stock take will be performed during the last weekend in June for each entity that deals in trading stock; and

·         it is expected that the trial balance of each of the business entities will be completed no later than 31st January after the end of the relevant financial year.

In respect of the personal tax returns for “the Group”, it is expected that all relevant information will be collated and forwarded to our office at the time that your business returns are prepared.  We shall detail more specific requirements in respect of the individual tax returns later in this letter.

Taxation services

In engaging us to provide taxation services, it is important for you to understand the following:

• You are responsible for the accuracy and completeness of the particulars and information provided to us by you.

• Any advice we provide is only an opinion based on our knowledge of your particular circumstances.

• You have obligations under the self-assessment regime to keep full and proper records in order to facilitate the preparation of accurate returns.

• We cannot provide taxation services if we find that information on which those services are to be based contain false or misleading information, or omit material information, and you are not prepared to appropriately amend that information.

Compilation of financial statements

By engaging us to compile financial statements, you acknowledge that:

• the reliability, accuracy and completeness of the accounting records are your responsibility; and

• that you have disclosed to us all material and relevant information.

No statutory financial audits are conducted

You and your employees are responsible for the maintenance of the accounting systems and internal controls for all the Entities. That includes the keeping and maintenance of all required books of account.  Our firm cannot be relied upon to disclose irregularities, including fraud, and other illegal acts and errors that may occur with regard to such matters.  Our firm is not being engaged to conduct a statutory audit of the financial records of any of your Entities and we will not express an auditor's opinion as to the truth and fairness of the financial statements.

Documentation

Before we lodge any returns on your behalf, we will forward the documents to you for approval, except in the case of Business & Instalment Activity Statements, where we will gain prior approval to lodge the returns.  We will endeavour to ensure that the returns are lodged by the due dates but if you are late in providing information, we will do our best to meet the time limits, but we will not be responsible for any lodgement penalties you may incur. Our preference is for you to receive ATO communications directly from the ATO, but upon agreement we can act as the nominated contact person.

Ownership of documents

The financial statements, tax returns and any other documents which we are specifically engaged to prepare, together with any original documents given to us by you, shall be your property.  Any other documents brought into existence by us, including general working papers, the general ledger and draft documents, will remain our property at all times.

If our services are terminated, we shall be entitled to retain all documents that we have prepared or hold until payment in full of all outstanding fees.

Additional services

Our agreed fees are only for the preparation and lodgement of the accounting and taxation matters detailed above.  Naturally, these fees include the checking and forwarding of original assessments and original payment notices that are received from the Australian Taxation Office and the Australian Securities & Investments Commission (ASIC).

However, any additional services or advice that you request are not included in this agreed fee.  These services will be charged on the basis of the time and degree of skill and acumen required to complete the task undertaken by us, including any direct out-of-pocket expenses.  Please note, any correspondence from the Australian Taxation Office or ASIC that does not relate to initial assessments or original payment notices will be treated as additional services.

Fees and charges

Our services will be provided to you on a fee for service basis. Unless otherwise stated in writing, any estimates which we provide to you of our anticipated fees, disbursements and charges for any work are only indicative of the amounts you can expect to be charged.  Estimates are not quotes or caps, and are not binding on us.  Where an estimate is given and the scope of the work changes, or if it becomes apparent that the work involves matters which were not taken into account in the estimate, we will endeavour to advise you and provide an amended estimate as soon as it is practicable to do so. We may require you to deposit money into our trust account in anticipation of our fees and charges.  If you fail to make a required trust deposit, we may suspend work or terminate this engagement.  Each client in the Group authorises us to apply trust moneys held on their behalf towards payment of fees and disbursements, and to meet our bill of costs which have been rendered and which have not been paid or disputed within 14 days after issue of the bill of costs. Each client in the Group is jointly and severally liable to pay our fees in respect of all work performed for all members of the Group.  We may require that payment of our fees be guaranteed by one or more persons who are associated with the Group but are not themselves our clients (for example, company directors). If you fail to provide a required guarantee, we may suspend work or terminate this engagement. If we suspend work or terminate this engagement by reason of your failure to make a trust deposit or provide a guarantee as required, we will not be liable for any loss or damage suffered by any client in the Group as a result of the suspension or termination.

We shall now outline the basis of our engagement in the context of the specific services that may be provided.

 

#Single Touch Payroll & PAYG Payment Summaries

We may prepare and lodge STP reports with the ATO for the Group, based on the information provided to us by you, your employees or any third party authorised by you, without reviewing or verifying the payroll calculations, any relevant wage rates or the source documents relied upon to process each STP pay event.   We will only provide a lodgment service. We make no representations about the accuracy of the information submitted, the due date or whether it is received by the ATO.  Our firm is not being engaged to perform, or check the accuracy of, payroll calculations associated with the STP reports.  You and your employees are responsible for correctly preparing and processing each pay event, and for maintaining the necessary supporting documentation.  You and your employees are also responsible for calculating and remitting your PAYG withholding and Superannuation Guarantee liabilities with respect to each employee, for each relevant pay event. We will also prepare and lodge PAYG Payment Summaries as required and under the same conditions outlined above for STP.

#Activity Statements

As the Activity Statements are usually prepared quarterly and lodged during the financial year, it is not possible for this firm to review the correctness of the underlying financial information as part of the preparation of the quarterly Activity Statements. 

This is because we are engaged to prepare the annual accounts and these are prepared at the conclusion of the financial year.

Therefore, for the quarterly Activity Statements, we will rely on and process the financial information provided to us without any review of the primary source documents.  In doing that, we will make the following specific assumptions:

·         the financial information provided to us is accurate;

·         the financial information correctly states the GST and PAYG Instalment and PAYG Withholding position.  For example, all input tax credits and GST payable amounts have been correctly recorded in the general ledger;

·         you have the necessary supporting documentation to satisfy the Australian Taxation Office for GST purposes; and

·         you hold valid tax invoices and adjustment notes for all expenditure incurred by you in respect of which an input tax credit is being claimed.

However, it is possible that, when the financial accounts are prepared, some discrepancies will exist between the information disclosed in the quarterly BAS returns and in the annual financial statements. 

Should any discrepancies arise, we will discuss the need to correct either the BAS returns and/or financial accounts and the fee for those services.

#Financial accounts

This firm may be engaged to prepare the annual financial accounts of “the Group”.  This service includes the preparation of:

·         a Profit and Loss Statement; and

·         a Balance Sheet;

This service includes maintenance of the charts of accounts for the general ledgers & depreciation schedules of your business entities.  It also includes telephone support should you require any assistance as to how to record specific transactions in the general ledger.

The fee for this service also includes the standard reports to be furnished to ASIC.

This service does not include the preparation of one-off accounts for presentation to your financiers for additional finance and the like.

#Income tax returns

This firm may be engaged to prepare and lodge income tax returns for “the Group”.

In addition to the basic financial information required to complete these tax returns, it is expected that the source documentation will be available to allow this firm to analyse the income tax implications of any transaction.

It is also expected that, in respect of individual income tax returns, each person will comply with the substantiation provisions of the Income Tax Assessment Act.

We will specifically advise as to the requirements of the substantiation provisions relating to your income tax return and of the necessity to obtain acceptable receipts as specifically required by the legislation. 

From time to time, this firm prepares templates and schedules to assist with the collation of information to complete income tax returns.  These will be provided free of charge.

The fee for this service does not cover any inquiries or investigations conducted by the Australian Taxation Office.

#Fringe benefits tax returns

This firm may be engaged to prepare and lodge the FBT returns for “the Group”.

Please note, with the introduction of GST, it is no longer possible to prepare an FBT return from the information contained in the general ledger. 

It is necessary to revert to the source documentation to allow this firm to analyse the FBT implications of any transaction.

Our fee for this service includes the following:

·         Advice on how to collate the information necessary to prepare the annual FBT return;

·         Telephone advice on basic FBT issues;

·         An annual review of the means to reduce the FBT expense on the annual FBT return; and

·         The calculation of Reportable Fringe Benefits Tax Amounts that are to be included on the annual payment summaries for your employees (including family members employed in your business).

#Self Managed Superannuation Fund

This firm may be engaged to attend to the compliance work for your Self Managed Superannuation Fund.  This assignment will involve:

·         preparation of the annual financial accounts, including members’ statements;

·         arranging the audit of the superannuation fund’s accounts for the purposes of the Superannuation Industry Supervision Act (the SIS Act);

In additional to the basic financial information required to complete these requirements, it is expected that the source documentation will be available to allow this firm to analyse the implications of any superannuation related transaction.

You should also note that the deeds of the fund should be annually reviewed by a superannuation specialist to ensure they continue to comply with the requirements of the SIS Act. 

Our engagement does not extend to the provision of legal advice and our fee does not include this service, although we are happy to recommend the services of a superannuation specialist for this task.

Our fee does not include financial planning services for the investments of the superannuation fund or any planning advice for your future retirement planning needs.

This service does not cover any inquiries or investigations conducted by the Australian Taxation Office.

If your SMSF incorporates a Limited Recourse Borrowing Arrangement we will not review the documentation unless you specifically request us to.

Superannuation Advice

We do not hold an Australian Financial Services Licence and are not an authorised representative of such a licence holder. As a result, we are generally prohibited from providing you with any advice, recommendation or opinion that is intended to influence you in making any decision in relation to superannuation (including whether to establish, contribute to or draw benefits from a superannuation fund, or any investment decision by an superannuation trustee), or that could reasonably be regarded as being intended to have such an influence (Financial Advice).  However, we are able to provide you with superannuation advice that is of a factual nature only (e.g., to explain how superannuation rules would apply to you and what options are available to you). Where you request us to undertake superannuation-related work (e.g., to arrange for the establishment of a self-managed superannuation fund), we will be obliged to perform that work in accordance with your instructions, even if we believe those instructions may not be in your best interest. Where you request Financial Advice concerning superannuation, we will endeavour to assist you in obtaining that advice from an appropriately licensed advisor. Depending on the circumstances, this may involve us outsourcing the provision of the Financial Advice (in which case we would seek your prior authorisation), or referring you to a licenced provider directly.  

Confidentiality

We will keep information acquired as a result of this engagement confidential and will not disclose confidential information relating to clients in the Group without permission, unless there is a legal duty to do so.  We will also not use any information acquired as a result of this engagement for our own personal advantage or for the advantage of a third party. We may also need to disclose information relating to one client’s affairs to other clients in the Group to assist in performing our work, to persons responsible for the governance of an entity to comply with accounting standards, to the relevant parties in order to protect our professional interests in legal proceedings, to a professional or regulatory body in response to an inquiry or investigation, to the relevant parties in order to comply with technical and professional standards (including ethics requirements), or to a professional body of which we are a member, in relation to a quality review program undertaken by that body.  Each client in the Group hereby authorises us to do so when we consider it appropriate to further our performance of work for the Group, or when requested by the relevant party. 

Information relating to your affairs

Our firm may, from time to time, use the services of third party contractors to perform some of the services we are engaged to perform for you.

The list of third party contractors currently used by our firm, to whom client information will or may be disclosed, is as follows:

·       Not applicable

We will notify you of any change to this list from time to time. Each client in “the Group” hereby authorises us to disclose information relating to that client’s affairs to such third party contractors as we may choose to engage to perform such work. Where we use the services of third party contractors, we are nevertheless responsible for the conduct and activities of those contractors and for the delivery of the services we are engaged to perform for you.

From time to time, our firm and our third party contractors may engage external IT service providers (including in relation to “cloud computing” services) in the performance of services under this engagement.

The list of external IT service provider(s) currently used by our firm or our third party contractors, to whom client information will or may be disclosed, is as follows:

·       Not applicable

We will notify you of any change to this list from time to time.

Each client in “the Group” hereby authorises us and our third party contractors to disclose information relating to those clients' affairs to such external IT service providers as we or our third party contractors may choose to engage.  We may also need to disclose information relating to one client’s affairs to other clients in “the Group” to assist in performing our work, to persons responsible for the governance of an entity to comply with accounting standards, or to a professional body of which we are a member, in relation to a quality review program undertaken by that body.  Each client in “the Group” hereby authorises us to do so when we consider it appropriate to further our performance of work for “the Group”, or when required by that professional body.

Our preference is that all Australia Taxation Office correspondence is directed to your address.

Utilising outsourced services

From time to time, our firm may use “outsourced services” (which may include “Cloud Computing”) to perform some of the services we are engaged to perform for you. The list of third party service providers currently used by our firm, to whom client information will or may be disclosed, are as follows:

• Not applicable

We will notify you of any change to this list from time to time.

Each client in the Group hereby authorises us to disclose information relating to that client’s affairs to such third party service providers as we may choose to engage to perform such work. Where we outsource services to third party providers, we are nevertheless responsible for the conduct and activities of those providers and for the delivery of the services we are engaged to perform for you. 

Use of “Cloud Computing” (that is not an outsourced service)

From time to time, our firm may utilise “Cloud Computing” in the performance of services under this engagement which is not an “outsourced service”. The list of “cloud computing” service provider(s) currently used by our firm in the provision of services which is not an outsourced service, to whom client information will or may be disclosed, is as follows:

-          MYOB

-          Quickbooks Online

-          Xero

-          Reckon Online

-          Dropbox

-          Acronis

-          Microsoft

-          Annature

-          Google

We will notify you of any change to this list from time to time.

Each client in the Group hereby authorises us to disclose information relating to those clients' affairs to such “Cloud Computing” service providers as we may choose to engage.

Non-compliance with Laws and Regulations (NOCLAR)

During the performance of our work under this engagement, we may detect conduct or a transaction that is considered to constitute NOCLAR, which has a material effect on any documents or information that might be required to be provided to a regulatory authority (RA), such as the ATO.  If we detect any NOCLAR, we may have an ethical requirement to make a disclosure to a RA.  We will follow a formal process which will include advising you of our concerns, and if necessary, seeking legal advice. If we do seek legal advice we reserve the right to ask you to pay or reimburse us for our reasonable costs. If we are required to make a disclosure to a RA, you agree to forever release us from any claim for costs or losses you incur in responding to or dealing with anything that arises from our disclosure.

Losses from unauthorised cyber-activity

We will take all reasonable precautions to ensure that any electronic data that contains your private information is securely stored and that any email transmissions are protected and are not able to be intercepted by third parties.  However, we cannot be held liable for any loss that you might incur as a consequence of any third party intervention that accesses, procures or copies any data that contains your private information from any medium or device we use to store or transmit such information.

In the event that, despite our firm having taken reasonable precautions to securely store your private information, you suffer any losses arising from unauthorised cyber-activity, you agree to forever release us from any claim for your losses.

14.   Limitation of liability

Our firm’s liability may be limited by a scheme approved under Professional Standards legislation and applicable regulations of the Professional Body.

15.   Handling of client money

Any receipt of client money by our firm, such as a tax refund, will be deposited into a bank account specifically separate for moneys to be held on trust.  All dealings with these moneys are in accordance with our professional and legal requirements for money held on trust. As part of this agreement you authorise us to deduct any outstanding fees for any members of the group from any moneys held in trust for any members of the group.

 

Confirmation of engagement

Obviously, there are many issues to consider in this engagement and we ask that you consider all aspects of this document to ensure that you are satisfied with the scope of our engagement. 

Please contact us if you have any queries about this document.

As mentioned above, if you do not contact us with changes to the engagement, yet continue to provide us with information and instructions regarding your financial affairs, the terms and information provided in this document will bind us both.

We thank you for the opportunity to provide accounting and taxation services to you and your business and we look forward to developing a close business relationship with you for many years to come.



Clients’ rights and obligations under the taxation laws

 As a client of this practice, we are obliged to advise you of your rights and obligations under the taxation laws in relation to the services we provide to you.  Set out below is a brief explanation of the main areas of the taxation system you should be aware of.  If you have any concerns or issues with any of matters discussed below, please feel free to contact us.   

The self-assessment system 

The Australian tax system operates as a self-assessment system. This means that when your tax return, Fringe Benefits Tax (FBT) return or Business Activity Statement (BAS) is lodged, the Australian Taxation Office (ATO) accepts the information in the return at face-value and issues you with an assessment notice based on that information.  It is important to understand that this does not mean the assessment is final as the ATO can conduct a review or audit of the information provided in the return at a later time, subject to the time limits discussed in the topic below.       

The Commissioner’s ability to amend an assessment 

As explained above, the ATO accepts the information lodged in your return at face value.  However, the ATO also has the power to amend the assessment if they find it to be incorrect.  The following rules generally apply: 

Individuals 

• For most individuals, the ATO can amend an assessment within two years after you receive your notice of assessment.  If the individual carries on a business and is not a Small Business Entity (SBE) or Medium Business Entity (MBE), that period extends to four years.  

• If the individual is a partner in a partnership or a beneficiary of a trust, the period is two years. If the partnership carries on business and is not an SBE or MBE, the period extends to four years.  If the trust is not an SBE or MBE, the period extends to four years. 

Companies 

• The ATO can amend a company assessment within two years after the company receives a notice of assessment where the company is an SBE or MBE.  If the company is a partner in a partnership or a beneficiary of a trust, the period is two years.  If the partnership carries on business and is not an SBE or MBE, the period extends to four years.  If the trust is not an SBE or MBE, the period extends to four years. 

• In most other case, the period is four years.

Trustees 

• The ATO can amend an assessment within two years after the trustee receives the notice of assessment if the trust is an SBE or MBE.  

• If the trustee is a partner in a partnership or a beneficiary of a trust, the period is two years. If the partnership carries on business and is not an SBE or MBE, the period extends to four years.  If the trust is not an SBE or MBE, the period extends to four years. 

• In most other case, the period is four years.

If the ATO amends an assessment, this will potentially involve, apart from increased taxes, penalties and interest.  If you discover an error in the information declared in the return, lower penalties generally apply for making a voluntary disclosure.  Note that there are no time limits on the ATO amending an assessment where they believe there has been fraud or evasion.  

Obligation to keep records 

The tax laws specifically require taxpayers to keep records that properly explain the transactions they have entered into. 

Individuals 

Individuals claiming deductions for work-related expenses are subject to the substantiation rules in the tax laws.  This requires taxpayers to keep receipts, invoices etc., of the expenses they incur.  Where the expenses relate to a taxpayer travelling interstate or overseas, a travel diary may also need to be kept.  Where the expense relates to a motor vehicle, a record of the journeys taken such as a log book may need to be kept. 

A failure to keep the appropriate records can lead to the ATO denying a particular deduction which may involve the imposition of penalties and interest.  Substantiation records must be retained for five years.  

Businesses 

The tax laws specifically require a taxpayer that carries on business to keep records that record and explain all the transactions they have entered into.  This includes all the documents that explain how the income and expenditure of the taxpayer was determined.  Where the tax laws allow or require a taxpayer to make a choice, election, estimate or calculation, documents containing particulars of these matters must be kept.   All these records must be retained for a period of five years.  There are penalties for taxpayers who fail to do so.  

Obligation to provide complete and accurate records 

In order for our practice to be able to lodge returns on your behalf, it is your responsibility to provide us with complete and accurate records.  Further, in order to lodge your return on time, we will require you to provide us the relevant information as and when requested.  Where you are unable to provide us with complete and accurate records, we may be unable to prepare and lodge your return.  Tax agents are subject to a Professional Code of Conduct contained in the Tax Agent Services Act 2009, which prevents them from acting for a client where insufficient records or information exists so as to be able determine the amount of the client’s income or deductions. We also reserve the right to question any claims for deductions or credits that in our reasonable judgment might be considered as being excessive, and we may ask for more substantiation or records to prove that such a claim is allowable under the law.  If we believe that a claim is excessive and cannot be substantiated we reserve the right not to include such a claim in your income tax returns or BAS, but you will have the right to lodge an objection after receiving your notice of assessment.  There may be further costs in doing so, and we will advise you accordingly.

Records for clients operating in the cash economy

Because of the ATO’s concerns with dealings in the cash economy, there are particular recording imperatives for clients who operate in that sector. In particular, the ATO has a program of “benchmarking” standardised revenue returns for a wide range of cash businesses.  In circumstances where it is dissatisfied with a taxpayer’s records or recording systems, the ATO will often assess income tax and/or GST on what it considers to be an appropriate “benchmark” amount (plus penalties and interest) and then put the taxpayer to the task of disproving that assessment.  Where that occurs, the taxpayer is at a serious disadvantage and can be put to a great deal of cost and effort in disputing the assessment. Taxpayers who operate in the cash economy are therefore urged to have a robust and reliable system for recording and reporting all cash transactions and to ensure that the recorded figures are accurate. If you need assistance in setting up or reviewing your recording and reporting systems, we will be happy to do so and will advise you of our rates for doing so on request. 

Right to seek a Private Binding Ruling 

When preparing your return, we may identify one or more issues that are not clear under the tax laws.  Where we have pointed out such issues to you, you have a right to request a Private Binding Ruling from the ATO.  Upon providing the ATO with all the relevant facts, they will provide you with a ruling setting out their view on the proper tax treatment of the issue requested to be ruled upon.     

Objecting against an assessment 

If the ATO issues you with an assessment that you do not agree with, you have the right to lodge an objection against that assessment.  The objection must be lodged with the ATO within either two or four years.  As to which period applies, this is determined in the same way as the discussion above under the heading ‘The Commissioner’s ability to amend an assessment’.  Where the ATO issues an amended assessment, the period for objecting is the greater of: 

• 60 days from the time the amended assessment is received; or

• two or four years (whichever is applicable) from the time the original assessment was received.

If you remain dissatisfied with the outcome of the objection, you have the right to have the matter reviewed by the Administrative Appeals Tribunal or to appeal the matter to the Federal Court.  

Onus of proof falls on the taxpayer

It is important to be aware that in any disputed assessment before the court or the Administrative Appeals Tribunal, the onus of proof is placed on the taxpayer. In other words, if the Commissioner asserts that your income should include a certain amount or that a deduction claimed in a return is not allowed, it will be up to you to establish that the Commissioner’s view is incorrect.  

Your protections under TASA 

The Tax Agent Services Act 2009 (TASA) and complementary amendments to the applicable taxation administration legislation provide statutory protections for taxpayers who engage registered tax agents.  In particular, as your tax agent, we are bound by a statutory Code of Conduct which is administered by the Tax Practitioners Board.  That Code requires us, amongst other things, to act lawfully in your best interests and with honesty and integrity in the performance of our duties.  In addition, as the client of a registered tax agent, you have statutory “safe harbour” exemptions from penalties in certain circumstances.  

When did the safe harbour provisions commence?  

The safe harbour can only apply for returns lodged on or after 1 March 2010. 

How does the safe harbour work?  

In order to benefit from the safe harbour should the need arise, it is a requirement for you to ensure that you provide us with all of the relevant tax information.  This includes any records, or documents we request from you plus any other information relevant to the preparation of your tax return. The information provided must be complete and accurate.   It is equally important that you provide us with this information by the time it is requested so as to allow the return to be lodged by its due date.  The safe harbour from late lodgment penalties can also apply where a Business Activity Statement, Instalment Activity Statement, or Fringe Benefits Tax return is lodged late.   

What does the safe harbour apply to?  

Whilst the safe harbour can apply to exempt the penalty for an error made in a tax return, it is important to note that the tax and interest will be still be payable.   

What if the safe harbour does not apply?  

Even if you are not eligible for the safe harbour, it is still possible to request the ATO remit or reduce the penalty.