What are Your Income Tax Return Obligations

The following types of entities are required to lodge an Income Tax Return (ITR) for each Financial Year:

  1. Individuals
  2. Companies
  3. Superannuation Funds
  4. Trusts
  5. Partnerships

Therefore if you are an individual operating your business through a Company structure, then you will more than likely need to lodge two Income Tax Returns each year. Whilst there are only five types of Income Tax Returns, there are numerous Schedules that do not form part of the main body the ITR. Examples of these Schedules are:

  • Capital Allowances Schedule
  • Losses Schedule
  • Work-Related Expenses Schedule
  • Capital Gains Schedule
  • Personal Services Income Schedule
  • Interest and Dividend Schedule
  • Franking Account

Therefore it is the correct completion of not just the main body of the Income Tax Return that will ensure you are being taxed correctly. The lodgement of the Income Tax Returns above has different effects as follows:

Individuals – A Notice of Assessment is issued after lodgement which provides a calculation as to the net amount payable or refund due to the individual. It will also advise when any amount payable is due to be paid.

Companies and Superannuation Funds – Both of these entities lodge their ITR’s under a system of Self Assessment, hence they do not receive Assessments from the ATO. The self-assessment system requires them to calculate their own tax liability and remit within certain specified time periods.

Trusts – Generally Trusts are not taxable, as it is the beneficiaries of the trust income that become taxable. However there are certain instances where the Trustee is assessed for tax and in this instance a Notice of Assessment will be issued to the trust.

Partnerships – These entities do not pay tax on the income they make. Instead it is the partners of the partnership who receive a share of the Net Income or Loss, which is then included in their ITR’s.

The due dates for lodging ITR’s is generally known to be 31st October, however if an ITR is lodged via a Tax Agent the return may have an extended due date to as late as June in the following year. At Bentleys, we prepare your Income Tax Returns with the utmost care ensuring that you are meeting all of your obligations, as well as endeavouring to provide you with the most favourable result. We are also extremely conscious of the due date of any Income Tax Return and endeavour to have it lodged on time.