$1,130 ATO bill ‘shock’ after Aussie makes common tax return mistake
A Melbourne woman is urging people to wait to lodge their tax returns after she was hit with a $1,130 bill from the Australian Taxation Office (ATO). Australians can now lodge their tax returns for the 2024-25 financial year, but the tax office and accountants have warned people they are better off waiting a few weeks.
Jen Rothwell recently found out she was audited by the ATO for her 2023-24 tax return. The 28-year-old told Yahoo Finance she was flagged because she hadn't included $2,000 in interest she earned from a term deposit in her taxable income in her return.
Banks report interest paid to the ATO, which then gets pre-filled into your tax return. But this data may not be finalised until the end of July.
That means if you lodge too early, you could miss out on information unless you manually input it yourself. This is what happened to Rothwell. Factoring in the $2,000 bank interest, she said she should have only received a $115 refund instead of the $12,00 that was paid to her, and now she has a $1,130 tax bill after her income was readjusted.
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“It came as a shock to me as I have never had that much money owing to the ATO before and currently at the moment, as we are saving for a wedding, having any large extra expenses that have not been planned is not ideal,” Rothwell said.
Rothwell said she lodged her tax return at the start of July last year, which was “too early” in hindsight and meant her bank hadn't yet reported to the ATO.
“I was unemployed at the time so I was probably keen to pocket any extra money that I could due to my circumstances,” she said.
Rothwell has now set up a payment plan with the ATO to pay off her tax debt, which she said was “easy enough” to do.
Her debt will be repaid in about 64 weeks. Any refund she receives from this year’s tax return will automatically go towards paying off the debt.
Do you have a tax story to share? Contact tamika.seeto@yahooinc.com
Other Aussies hit with ATO bills
Rothwell shared a video online about her experience and found other Aussies had had similar experiences.
"This exact thing happened to me last year, but I waited to do it, Westpac was just so slow. Got charged an extra $700 by the ATO even though I already had to pay $2,500," one person wrote.
"This exact thing happened to me, only found out when I logged in last night to do my tax return again this year. Not a happy surprise!" another said.
