TAX INFORMATION

[FAQ]

Disclaimer-The information obtained from the interview in between Michael Hung & Taxation Office on Vietnamese television C31 Australia. Therefore we however, cannot guarantee that every document will appear in the correct tax year, should check the content of all documents returned by this web site in response to your query and seek independent advice before embarking on a transaction.

Lodgment

Well, the 2002 income year finished on 30 June, so it's time to start thinking about your tax return. If your income totalled more than $6,000, most people will need to lodge a tax return. But if your income is lower than $6,000, are there any reasons why you'd have to lodge a tax return?

- You'll need to lodge a tax return if you had any amounts of tax withheld as an employee or a contractor. Even if you're a non-resident, you'll need to lodge a return if you received more than one dollar of Australian taxable income that hasn't been subject to withholding. You will also need to lodge a tax return if you operate a business.

Some seniors can earn more income before they need to pay tax or lodge a tax return if they are eligible for the Senior Australian Tax Offset .
Even if you don't have to lodge a tax return for a particular year, you may still need to complete a form called, a non-lodgment advice and send it to the Tax Office.

Information about whether you need to lodge a return or complete a non-lodgment advice can be found in two English language Tax Office publications that have been delivered to households all around Australia - Tax Pack 2002 and the tax time pamphlet.

Who do need to lodge a tax return can do this in a number of ways, can't they? For example, they could go to a registered tax agent and have them prepare the tax return for them.

- Yes, a registered tax agent can prepare and lodge your tax return for a fee that you can later claim as a tax deduction.

Generally, you must lodge your tax return by 31 October 2002, but you have more time if a registered tax agent is preparing your return.

If you didn't use a tax agent last year - or if you're going to a different agent this year - we recommend you see the agent before 31 October 2002 to make sure you're on your agent's client list for an extended lodgment date.

I believe there are some unscrupulous people holding themselves out to be registered tax agents. How can you find out if they're dealing with a registered tax agent?

This is an important issue. Unregistered tax agents operate outside the law and offer taxpayers no legal protection. Viewers should make sure they choose a registered tax agent to help them with their tax obligations, and they can do this by checking the list of registered agents on the Tax Office website.

If a viewer doesn't use a tax agent, they could prepare their tax return themselves using TaxPack 2002 and just follow the instructions. What protection does a viewer have if they use TaxPack to prepare their return?

TaxPack is an English language product, and the Tax Office doesn't expect taxpayers to know more than what is presented in TaxPack. If you use TaxPack properly and make an honest mistake, the Tax Office will accept that this wasn't intentional and will not charge a penalty. However, we may impose the general interest charge on any tax viewers have underpaid

Taxpayers can also lodge using the internet. How does this program work?

- You can lodge your income tax return over the internet using e-tax. This is an English language electronic package that helps you prepare your income tax return easily, quickly and securely. e-tax will ask questions and complete the tax return based on your answers. e-tax does the calculations for you in completing your tax return and then it will calculate your tax refund or tax debt for you. People who use it tells us that it really does make tax easier for them.

Most tax returns lodged using e-tax are processed within 14 days. So if you use e-tax and you have a refund due, you'll receive it quickly. On the other hand, if you have a tax debt and you've lodged your return by 31 October, you'll have until 21 November to pay what you owe. e-tax is free from the ATO - all you need is access to a computer and the Internet. You can find it on our website, www.ato.gov.au, and then just follow the links to download e-tax.

So if viewers are lodging a paper form, they just send it to the Tax Office, don't they?

- Yes, that's right - just use the pre-addressed envelope enclosed with TaxPack. If you don't have the pre-addressed envelope, just use a business size envelope and send it to this address: Australian Taxation Office, GPO Box 9845, in your capital city. Don't replace the words 'in your capital city' with the name of your capital city. We have a special agreement with Australia Post that means there's no need for you to include the actual name of your capital city or a postcode.

An alternative, faster method of lodging your tax return is to use Australia Post's TaxPackExpress service. Through this service, Australia Post lodges your tax return electronically with the Tax Office for a fee of $21.50. This fee is tax deductible in your next year's tax return. The Tax Office will then process most returns in around 14 days.

Viewers should be aware that it's alright for someone to prepare a tax return on behalf of someone else. For instance, a family member or friend can help you, as long as they don't charge you a fee.

That's right. Remember that even if someone else - like a family member, friend or tax agent - helps you prepare your tax return, you are still legally responsible for the accuracy of the information.

The Tax Office trains a network of community volunteers to help some people prepare their tax returns. What can you tell our viewers about this?

This program is called Tax Help and it's a service that's available for people on low incomes.Tax Help is available from July to October each year. This year around 2,000 volunteers will be operating from 860 centres throughout Australia. Over 100 of the centres have volunteers from various Indigenous and non-English speaking backgrounds.

For more information about Tax Help, call 13 28 61 and ask about making an appointment at your nearest Tax Help centre. If you don't speak English well, you can call TIS to help with your call.

For people who may not have completed a tax return before, what happens once they've sent it to the Tax Office?

Once your tax return has been processed, you'll receive a notice of assessment that tells you the refund you will receive or how much you owe the Tax Office. If you owe money, the notice of assessment tells you the date you have to pay the amount by and your options for paying - such as Bpay, cheque or through the Post Office. If you don't pay by the nominated date you may be charged a general interest charge for late payment " You should be aware that if you lodge your return late this general interest charge will apply from 21 days after you should have lodged.".

You mentioned earlier the $6000 tax-free threshold. It may be an issue for someone lodging for the first time because they may only be entitled to part of it. If you've stopped full time education or become an Australian resident during the year, you may only receive a part-year tax-free threshold. Can you explain this to our viewers?

Sure. The tax-free threshold is $6,000 for the whole year, which means you can earn up to this much without having to pay income tax. However, if you have stopped full time education for the first time or become, or stopped being, an Australian resident during the year, you receive a part-year tax-free threshold . The part-year tax-free threshold means that any taxable income you earn above that threshold is taxed at the marginal tax rate.

Let's look at the example of Khoa who has been an Australian resident for eight months, including the month in which he became a resident. You work out one-twelfth of the tax-free threshold, that is $500, and multiply this by the eight months Khoa has been a resident. Eight months by $500 is $4,000, which means Khoa's part-year tax-free threshold is $4,000. So he won't pay tax on the first $4,000 he earns for the year.

Where can you get more information ?

The Tax Office website - www.ato.gov.au - contains a range of tax information in Vietnamese - just click on the Other Languages icon. If you'd like more information about your income tax , you can phone the Tax Office on 13 28 61. If you don't speak English, you can phone the Translating and Interpreting Service on 13 14 50 for help with your call.