| Disclaimer This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law. You cannot rely on this record in your tax affairs. It is not binding and provides you with no protection (including from any underpaid tax, penalty or interest). In addition, this record is not an authority for the purposes of establishing a reasonably arguable position for you to apply to your own circumstances. For more information on the status of edited versions of private advice and reasons we publish them, see PS LA 2008/4. |
Edited version of your written advice
Authorisation Number: 1012821797602
Date of advice: 15 June 2015
Ruling
Subject: Business records
Question
Will the Commissioner provide substantiation relief and accept the business activity statement amounts for the purposes of lodging the tax return for the year ended 30 June 2014?
Answer
Yes.
This ruling applies for the following period
Year ended 30 June 20XX
The scheme commenced on
1 July 20XX
Relevant facts
The director of entity A had their motor vehicle stolen.
All the business records for a number of previous years and a business laptop were inside the motor vehicle at the time to be transported to a different location.
The theft was reported to police. Neither the motor vehicle nor the files or the laptop have been recovered.
Entity A is registered for GST and had lodged their quarterly business activity statements during the relevant financial year. These statements were prepared based on the original records and reflect the actual income earned and expenses incurred for the relevant financial year.
Relevant legislative provisions
Income Tax Assessment Act 1936 Section 262A.
Reasons for decision
Subsection 262A(1) of the Income Tax Assessment Act 1936 (ITAA 1936) imposes an obligation on a person carrying on a business to keep records that record and explain all transactions engaged in by them that are relevant.
Taxation Ruling TR 96/7 Income tax: record keeping - section 262A - general principles provides guidelines on record keeping under section 262A of the ITAA 1936. Relevant records to be kept include documents that are relevant for the purpose of ascertaining the income and expenditure. Bank records, such as credit card or debit card statements can be used with other documents to support the relevant income and expenses.
Taxation Ruling TR 97/24 Income tax: relief from the effects of failing to substantiate provides guidance on circumstances in which relief from the effects of failing to substantiate may apply. Although this ruling and the associated Division 900 of the ITAA 1997 specifically relate to work, car and business travel expenses, the principals may be applied to other record keeping requirements.
A bona fide attempt should be made to comply with the record keeping requirements.
In the specific circumstances of this case, the Commissioner will accept the amounts from the business activity statements to ascertain the income and expenses of entity A. These amounts can be used to lodge the relevant tax return.