• Recurring data issues

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    These issues are common to multiple years' pre-filling reports:

    Calculating ATO interest

    2016 income year

    We have simplified our data capture process for pre-filling. This will help reduce the complexities which affected the calculation of ATO interest in prior years. However, you may need to make adjustments to the 2016 pre-fill data as this is the transition year for the new process.

    In certain limited cases, ATO interest data will not be pre-filled. You will need to refer to your client’s statements of account and other source documents for this information.

    If you choose not to rely on our pre-fill information you will need to manually calculate your interest amounts using your statement of account.

    See also:

    Note: The Portal year to date interest summary report cannot be used as an alternative source of information as it does not accurately capture ATO interest data for the purpose of declaring deductions or interest income.

    2015 income year and prior

    ATO interest totals will not be provided in the pre-fill reports for the 2013 and prior income years. There will also be circumstances when interest data will not be provided for other years (for example, where we have determined the interest data will not be correct). Your client may receive a message that they have interest. In all these cases, you will need to refer to your client’s statements of account and other source documents for this information.

    The business rules for the pre-fill reports do not correctly capture the interest data in certain circumstances. (For example, where your client has not claimed a GIC deduction in an earlier year and there is a later remission that does not have to be declared. We report on the basis that a deduction has been or can be claimed.) You should check your clients' statements of account to ensure the accuracy of the pre-fill data before lodging their tax returns.

    We stopped updating the pre-fill reports from 9 November 2015. This means any interest transactions processed on your client’s accounts after 9 November 2015 that impact interest totals in 2015 or an earlier year, will not be included in the interest reports for those years. This means you may need to make adjustments to the pre-fill data. You will be guided in 2016 on how to account for any discrepancies between the 2015 and 2016 interest reports.

    Example: impact of change to static interest report

    The taxpayer lodged their 2014 income tax return on time – all GIC imposed is automatically remitted.

    Statement of account view:

    Processed date

    Effective date

    Role

    Transaction description

    Debit

    $

    Credit

    $

    Running balance $

     

    12/02/2015

    23/03/2015

    Income tax - individual

    Tax return individuals - Income Tax for the period from 01/07/13 to 30/06/2014

    398.50>

    0.00

    389.50

    DR

    01/04/2015

    01/04/2015

    GIC

    GIC calculated from 02/03/2015 to 31/03/2015

    0.95

    0.00

    399.45

    DR

    01/04/2015

    01/04/2015

    GIC

    Remission of GIC

    0.00

    >0.95

    389.50

    DR

    01/05/2015

    01/05/2015

    GIC

    GIC calculated from 01/04/2015 to 30/04/2015

    3.07

    0.00

    401.57

    DR

    01/05/2015

    01/05/2015

    GIC

    Remission of GIC

    0.00

    3.07

    398.50

    DR

    12/05/2015

    12/05/2015

    GIC

    GIC calculated from 01/05/2015 to 11/05/2015

    1.12

    0.00

    399.62

    DR

    12/05/2015

    12/05/2015

    GIC

    Remission of GIC

    0.00

    1.12

    398.50

    DR

    01/06/2015

    01/06/2015

    GIC

    GIC calculated from 12/05/2015 to 31/05/2015

    2.04

    0.00

    400.54

    DR

    01/06/2015

    01/06/2015

    GIC

    Remission of GIC

    0.00

    2.04

    398.50

    DR

    11/11/2015

    01/07/2015

    GIC

    GIC calculated from 01/06/2015 to 30/06/2015

    3.07

    0.00

    401.57

    DR

    11/11/2015

    11/11/2015

    GIC

    Remission of GIC

    0.00

    3.07

    398.50

    DR

    11/11/2015

    01/08/2015

    GIC

    GIC calculated from 01/07/2015 to 31/07/2015

    3.30

    0.00

    401.80

    DR

    11/11/2015

    11/11/2015

    GIC

    Remission of GIC

    0.00

    3.30

    398.50

    DR

    The 2015 ATO interest pre-fill report will provide the following detail:

    • total net deductible interest expense: $7.18
    • total net assessable interest income: $7.18.

    The $3.07 GIC debit processed on the account on 11 November 2015 will not be included in the interest totals as this transaction was processed after the pre-fill report was made static.

    Taxpayers who choose to complete their 2015 income tax return using the interest amounts reported by the ATO will be guided in 2016 on how to account for any data discrepancies between the 2015 and 2016 interest reports.

    Alternatively, taxpayers can use their statement of account to determine the interest deductions and income for the 2015 income year. In the example above, the interest claims for the 2015 income year would be:

    • total net deductible interest expense: $10.25
    • total net assessable interest income: $7.18.

    In this case, the taxpayer will need to declare the associated GIC remission of $3.07 (processed on 11 November 2015) in their 2016 income tax return.

    End of example

    See also:

    Interest from non-formal trust accounts

    Interest from non-formal trust accounts, such as children's bank accounts, may be matched to the trustee (parent).

    Non-formal trust accounts with entity type 'I' (for individuals) are included for the pre-filling service. If the parent name forms part of the account name the record may be matched to the parent name. This is regardless of whether the parent TFN is attached to the account or not. The provision of this income allows you to work out whether the income needs to be declared in your client's tax return.

    Exclusions

    For discrepancy identification purposes, non-formal trust accounts with the following words are excluded:

    • '<Trustee name> ATF <beneficiary name>' if single trustee
    • '<Trustee name and Trustee name> ITF <beneficiary name>' where multiple trustees.

    Letters should not be sent to trustees of children's bank accounts where these name formats are used, although it may sometimes happen.

    This affects years 2008 to 2016 inclusive.

    Non-individual investment income

    An individual client's pre-filling report may show an amount of investment income that belongs to a linked non-individual, such as a superannuation or trust fund.

    This normally occurs if the entity's investment account has been established incorrectly. The interest or dividend income from these accounts will be incorrectly mapped to the individual client's record in our systems if their linked entity account has been established with either of the following:

    • the individual's personal TFN quoted
    • an entity type 'I' that is for an individual account.

    Correct the record for the future

    To prevent these records showing on future reports, ask your client to contact their financial institution to ensure the correct:

    • TFN is quoted on the account
    • entity type is listed on the account, for example, the correct entity type for a formal trust account is 'T', and for super accounts is 'S'.

    This will not change what currently appears in the report unless the information provider sends us a replacement report.

    This affects years 2008 to 2016 inclusive.

    Managed fund data reporting discrepancies

    Your client's pre-filled managed fund data may be different to the statement they receive from their managed fund.

    We have found discrepancies between the information fund administrators send to their clients and the information they report to us for pre-filling.

    This is an issue due to ongoing inconsistencies between:

    • the standard distribution statement
    • the tax return and the reporting specifications.

    The lead times that funds and software developers need to make changes to their systems can also contribute.

    Tax agents have advised that even if this data is incorrect, they prefer to see it in the pre-filling report because it prompts them to closely check their clients' statements.

    Which amount to use

    If the pre-filled information doesn't match your client's statement, use the information the managed fund provided to your client. Contact the managed fund if you have any questions.

    This affects years 2008 to 2016 inclusive.

    Multiple or duplicated payment summaries

    There may be instances where multiple payment summaries display in the pre-filling report, for example, if your client has worked for the same employer for multiple periods during the year.

    However, sometimes the pre-filling report appears to be showing both original and amended payment summaries.

    This usually occurs when an employer or payer has lodged a subsequent payment summary, such as an amendment, and not reported it correctly; or the pre-filling system has been unable to accurately match the replacement record against the original record. This may also be the result of some accounting software.

    The pre-filling report displays the dates of all records to assist you to identify the correct record.

    If the employer/payer has reported amended payment summaries to the ATO and has provided your client with an amended payment summary or letter, our processing systems for post-lodgment data matching should identify the correct payment summary.

    What your client should do

    If your client disputes the records displayed in the pre-filling report, they will need to query this with their employer/payer.

    This affects years 2008 to 2016 inclusive.

    Reportable employer super contributions on payment summaries

    Some employers have incorrectly included other amounts, such as super guarantee payments, in the reportable employer super contributions (RESC) field of the payment summary.

    Before lodging your client's tax return, either you or your client should contact the employer to check that the payment summary figure is correct if both the following apply:

    • your client's paper or pre-filled payment summary information includes an amount for RESC
    • your client does not salary sacrifice super.

    If the amount is incorrect, the employer will need to issue an amended payment summary to your client and any other affected employees. If they have already lodged their payment summary annual report with us, they will also need to lodge an amended annual report.

    An incorrect amount showing as reportable employer super contributions could impact on your clients' eligibility for some tax offsets. This could result in your client being charged the Medicare levy surcharge, affect their eligibility for Centrelink benefits, or alter a child support assessment.

    This affects years 2010 to 2016 inclusive.

    Last modified: 24 Jun 2016QC 44696