Recently the government announced increased funding for the ATO to focus on three key areas:
Compliance activities for individual taxpayers and their tax agents
Improvements in debt collection strategies
New strategies to combat the black economy
This means, now more than ever, that the likelihood of being audited has increased and it is naive to think that just because you lodge your tax return via an accountant you will never be audited.
What is Audit Insurance?
Audit insurance is an insurance that provides payment of professional fees otherwise payable by you when incurred as a result of your accounting firm being required to respond on your behalf to an audit, enquiry, investigation, review or examination by the ATO or any other government revenue agency.
What associated investigations are covered under Audit Insurance?
- Capital Gains Tax
- Land Tax
- Payroll Tax
- Employer Obligations
- Stamp Duty
- Fringe Benefits Tax
- Super Guarantee
- R & D Tax Incentive
- Income Tax
- Record Keeping
- Workcover/Workers Compensation
Benefits of Audit Insurance
- Peace of mind knowing you have a cost effective way to avoid the stress that can accompany an ATO audit
- Payment of the premium is tax deductible
- The cover is retrospective, so previously lodged returns are automatically covered
Should you take up audit insurance?
It is our suggestion that you put some consideration into accepting audit insurance. Audits can be a very extensive process that can take considerable time and cost a lot in professional fees. Therefore, it would be beneficial to weigh up the hourly costs of your accountant compared to the premium associated with the cover you require.
If you have any queries regarding Audit Insurance, feel free to get in touch with us to discuss: (08) 8284 3208.
Kate Morgan, Administration Manager