Tax Audit Insurance

Tax Audit Insurance – What is it?

This is Insurance that covers your professional accounting fees should you be audited by the Australian Taxation Office (ATO) or any other Australian (Federal, State or Territory) government agency which has the statutory responsibility to conduct audits in relation to taxation, duties, levies or other such statutory imposts in connection with a Business.

Any client, individual or entity, can be the subject of an audit. Tax audits can be expensive and are on the increase.

What are random tax and government audits?
Audits, reviews and investigations are conducted by the Australian Tax Office (ATO) and other state and federal government agencies to ensure business and tax payer compliance with various tax and legislative requirements such as Income, Land and Payroll Tax, GST, Workers Compensation, Superannuation Guarantee, Compliance research, Development Grants and more.

How likely am I to get a random audit, review or investigation?
The ATO and other federal and state agencies, continue to announce they are increasing their audit activity. Increasingly, Individuals, Businesses and Self Managed Superannuation Funds are at risk of a random audit or review.

The ATO also publishes a compliance program annually. The segments they target are individuals - micro businesses (annual turnover under $2 million) and small to medium enterprises (annual turnover of over $2 million). The ATO continually increases its data collection or detection scope (including property and share transactions) under its data matching program that in 2007 - 08 accessed 78 million taxpayer income records. Benchmarking and risk profiling average business income and expenses is another ATO compliance detection tool. Statistically, a client can expect to be audited at least once every four years.

What are the costs to busineses and tax payers in the event of a random audit, review or investigation?
If your business or individual return is subjected to a random audit, review or investigation, you are responsible for the costs involved in providing the required information. Even the simplest enquiry can require hours of work. In multiple years or multiple companies and trusts, thousands of dollars in accounting and legal fees can be incurred.

What audits, reviews and investigations are covered?

  • Income Tax
  • GST & BAS
  • Superannuation Guarantee
  • PAYG Withholding
  • Fringe Benefits Tax
  • Payroll Tax
  • Land Tax
  • Stamp Duty
  • Work Cover
  • Self Managed Superannuation Funds
  • And many other lodged returns

What is not covered?

  • audits conducted by APRA
  • incidental, routine enquiries
  • audits where notification was received prior to the cover being taken up
  • fraudulent, reckless, dishonest, criminal or malicious act or omission
  • false or misleading statements attributed to deliberate evasion, recklessness or carelessness unless the client could not reasonably be expected to know the status of the statement
  • criminal prosecution of the client
  • a client's activities where the collective turnover in the latest financial year is greater than $50 million


Who is covered?
Different levels of cover are available for:

  • Salary and wage earners;
  • Businesses or business groups with turnover under $100 million;
  • Self managed superannuation funds;

In many cases, individuals and family entities can be covered by the same policy that covers the business entity – for no extra cost.

Who can help?

An insurance broker's role is to act as your representative and work in your interests, seeking the best cover at the best price for you with their skill, market knowledge and experience. Call a good one.

Call CPR –Experts who will save you

  

Latest News

Will you lose the value of a Broker?

If you listen to the Podcast on this link you will here Robert Cooper explain to his Accountant why Small Business stands to lose if Insurance Brokers are not there to advise start up businesses and established businesses about the risks their occupation carries and how they can deal with them. Simply because they will not want to pay the fees that would be charged. Currently instead, Insurance Companies pay the Broker after the Insurance has been placed with them. Perhaps the premiums will appear a bit cheaper in the first year? Then they will question the fees an Insurance Broker puts on top and finds they can go to the Internet and obtain the same cover at the same price. However, they will not have the constant advice and claims advocacy that comes with an Insurance Broker. The big loser is definitely the Consumer as direct insurers give absolutely no advice, only price.

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Robert Cooper - one of 100 faces of small business

This week it was announced as part of Small Business Week,  that Robert has been named one of the 100 faces of small business for a State Government promotion on the great value that small businesses play in the State of Queensland.

You can see Robert's entry here:

It is the third accolade for CPR Insurance Services in a month and after seven and a half years in business is a real pep up for the company.

For Robert, it is the culmination of many years experience, becoming well qualified, experiencing the highs and lows of a career and always wanting to contribute to his community. Sometimes, these things just come together and you receive recognition for your efforts.

Robert says that there is no doubt that starting your own business is a huge challenge, but with the right research and planning, the right people around you and a good set of values that you apply to the vision of the company, you have a very good chance of making it all succeed.

Robert says he is lucky. He has a strong supportive Wife, Mandy, who is also part of the business, along with efficient and hard working staff such as Julia McLauchlan and Aidan Harmer who are building up their own skills in a learning environment. 

However, the most important and most supportive people for CPR Insurance Services are our clients who have stuck by us and supported us over the past seven years. Our focus remains on providing the best possible service we can and always acting in their best interests. To all our clients, we say thank you!

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