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  • Recurring data issues

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

    Calculating ATO interest

    We currently provide the ATO interest data in the Pre-filling report for individual taxpayers.

    Year to date interest summary report – all entities

    Previously, you may have used the Year to date interest summary report (YTD report) available on the Portal to complete your client's tax return. The YTD report is not intended to be used for this task as it does not accurately capture ATO interest data for the purpose of declaring deductions or assessable interest income. We have revised the interest descriptions so that they describe the nature of the interest being reported.

    If you need help working out ATO interest deductions and income, see ATO interest - calculation and reporting.

    Pre-filling report – individual taxpayers

    The report sources ATO interest amounts from the income tax, fringe benefit tax (from 2018) and integrated client accounts (ICA).

    In the following situations, you may need to assess your clients' circumstance and adjust the interest amounts reported accordingly.

    Recoupments of interest charged

    When we report interest remission and credit adjustments as assessable income we assume your client has claimed a deduction for interest that we imposed. If they have not claimed a deduction and the period for requesting an amendment of their return to claim the deduction has lapsed, they do not have to claim the interest income. You may need to adjust the interest totals we have provided.

    Change in residency status

    We report on the basis of your client's residency status when the interest data is extracted from their account at year end. If they were a non-resident when interest was paid then we should have withheld tax from that payment. If this is the case they do not have to declare the interest in their income tax return. If tax was not withheld, they will need to declare the interest income. You may need to adjust the interest totals we have provided.

    Movement of transactions across ICA

    We move transactions across accounts to undertake a number of administrative actions (for example, to isolate pre and post-bankruptcy transactions; to isolate amounts that are in dispute). When a transaction is moved between accounts, the process date is reported as the date the transaction was moved. This means interest previously reported may be reported again in a later pre-fill report. We have revised our business rules to prevent this duplication in the 2018 pre-fill. You may need to adjust the interest totals we provide for the 2017 and prior years if your clients' accounts contain moved transactions.

    You should check your clients' statements of account and other source documents to ensure the pre-fill data reflects their specific circumstance before lodging their tax return.

    2016 and later income years

    For the 2016 and later income years, we introduced a new way of capturing and reporting general interest charge, shortfall interest charge and late payment interest. This new process helps reduce the complexities that affected the calculation of ATO interest in prior years. You may need to make adjustments to the 2016 pre-fill data, as this was the transition year for the new process.

    We haven't changed how we calculate or report interest on early payment (IEP), interest on overpayment (IOP), or delayed refund interest (DRI).

    If you choose not to rely on the new pre-fill reporting method, you will need to manually calculate your client's interest amounts using their statement of account.

    In some circumstances, we may not provide pre-fill data but will display a message that the client has interest. In this case you will need to manually calculate the deductions or income amounts, using either the new or previous reporting method.

    See also:

    2015 income year and prior

    ATO interest totals are not provided in the Pre-filling reports for the 2013 and prior income years. A message will display advising that the client has ATO interest on their account.

    You will need to refer to your client’s statement of account to manually calculate ATO interest.

    The 2015 Pre-filling report was changed to a static report from 9 November 2015. This means any interest transactions processed on your client’s account after 9 November 2015 that impact interest totals in 2015 or an earlier year, will not be included in the Pre-filling reports for those years. This means you may need to make adjustments to the pre-fill data. Refer to ATO interest - calculating and reporting for information about how to account for any discrepancies.

    Interest from non-formal trust accounts

    This affects years 2008 to 2018 inclusive.

    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's TFN is attached to the account. 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.

    Non-individual investment income

    This affects years 2008 to 2018 inclusive.

    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.

    Managed fund data reporting discrepancies

    This affects years 2008 to 2018 inclusive.

    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
    • tax return and the reporting specifications.

    The lead times that funds and digital service providers 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.

    Multiple or duplicated payment summaries

    This affects years 2008 to 2018 inclusive.

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

    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.

    However, the pre-filling report may show both the original and amended payment summaries.

    This can occur when:

    • an employer or payer has lodged a subsequent payment summary, such as an amendment, and not reported it correctly
    • 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.

    What your client should do

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

    Reportable employer super contributions on payment summaries

    This affects years 2008 to 2018 inclusive.

    Employers may incorrectly include other amounts, such as super guarantee payments, as reportable employer super contributions (RESC) in the payment summary.

    Reportable employer super contribution amounts can impact eligibility for some tax offsets. It can also result in Medicare levy surcharge being applied, affect eligibility for Centrelink benefits, and alter child support assessments.

    Before lodging your client's tax return, 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 must 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 must also lodge an amended annual report.

    Last modified: 19 Jul 2018QC 44696