Tips for Tax Time 2011

We are providing the following information to:

• explain how we will operate over the tax time period
• help you prevent some unnecessary delays in the processing of your clients' returns.

Our commitment to you

As we process returns, we will alert you to any matters that arise that will cause delays to the issue of refunds or assessments. To help us do this, we will be meeting weekly with tax practitioner representatives to share our progress during tax time. We will also publish weekly online updates, including our processing performance, from July to the end of October 2011 to keep you and the public informed.

If you have any concerns or questions, phone us on the Registered Agent Info Line 13 72 86.

Service standards for 2011

In line with our service standards, we plan to process 94% of individual electronic returns within 14 days.

Returns lodged on paper take longer to process; however, we plan to process 80% of these within 42 days.

Things to remember this year

Earlier income tax return lodgment times
On 6 July, we will start full production processing of 2011 income tax returns. This is almost a full week earlier than last year. As usual, until returns are processed and amounts posted to accounts they will not be visible on the Tax Agent Portal.

Final assessment position

If you look at your client's details on the Tax Agent Portal, the issue date and refund amount are both subject to review and change until the notice of assessment actually issues.

For examples of issues that can change the amount and issue date, see below.

Common errors

In 2010-11, there were almost 300,000 errors in returns prepared by agents due to incorrect name, address, or date of birth details. Some other common errors we see during tax time include:

• supplying incorrect bank account details
• forgetting to include
• changes of name - for example, in the case of marriage
• interest from a bank account
• income from a previous job.

Any error can result in the return being stopped and can slow down the processing of your client's return.

A top tip mentioned in the Tax Practitioner Consultative Forums is don't just roll over the front page of the tax return in your system; make sure you check all the details.

We also need to take extra steps in our processes when:

• clients have relationships with other government agencies, such as Centrelink or the Child Support Program - offsetting actions will involve a delay of between approximately one and ten days, depending on a client's circumstances
• clients are registered with Centrelink to receive a family tax benefit - these will take an extra three days to move through the system
• we need to check information in returns (see Return integrity)
• information provided by other agencies does not support claims made by a client
• financial institution account information is out-of-date.

When these issues arise, we usually need to review the return, contact the client and where necessary, adjust the return.

Return integrity

We use technology to help us identify and review returns that may contain missing and/or incorrect information. All returns (when lodged) are held and assessed against our risk models. This process takes 48 hours. Claims outside normal ranges will result in all aspects of a person's tax position being reviewed. Some of the common issues identified include:

• understated income, or taxpayers claiming fictitious tax withholding credits without working for an employer
• overstated or fraudulent deductions
• non-entitlement to claimed rebates and/or tax offsets
• non-entitlement to a Medicare levy exemption
• non-residents claiming to be residents for tax purposes
• instances of identity takeover/theft
• unusual levels of pay as you go (PAYG) withholding (credit compared to income.

Delays may also be experienced where third party information we use to verify some returns is not available when the tax return is lodged. For example:

• most employers are not required to lodge payment summary annual statements until 14 August. Tax returns lodged before that date may be delayed if this information needs to be verified
• tax returns with distributions from partnerships and trusts may be delayed when the related entity has not yet submitted its tax return.

Pre-filling update

We will place key messages on the log on page of the Tax Agent Portal.

Remember pre-filling reports only reflect the information received by us as at the date of the report.

A top tip mentioned in the Tax Practitioner Consultative Forums is that you can cross-check pre-filling reports with information provided directly by your clients.

What's new in 2011?

We have information about what's new in 2011 and anticipated data availability.

The 2010 and other prior year documents have been reviewed and cross-referenced.

The main pre-filling document has been updated to reflect known issues and cross-referencing.

Subscribe to weekly online updates

We will be regularly publishing online updates to our website about the status of return processing. You can subscribe via our website to receive these updates.

For more information, refer to: Notice of assessment for income tax fact sheet Statement of account for income tax fact sheet.