Tax payers who failed to pay tax on time due to any reason, will surely have to pay some interests or penalties over the tax they have to pay. To minimize these interests and penalties, tax payers can file for overdue tax return and pay the tax as soon as possible.
Interests and penalties are different for tax payers depending upon his nature and size of business, income and property. It may increase over year up to a certain percentage of amount depending on above mentioned categories.
What if you have overdue tax return?
If you found an overdue tax return, firstly the federal government will issue you an FTL (Failure to Lodge) penalty. This penalty is increased in 28 days of interval per one unit of penalty.
Acceptable reasons for filing overdue tax return:
Not all the reasons are acceptable for overdue tax returns, tax agency does not consider any lame excuses. Only severe reasons like fire, casualty, natural disasters, troubles and all the circumstances which are beyond your control are considered as acceptable for this. In any other condition, the interests and penalties could not be minimized. These penalties and interests are charged by law and any agency has not has right to make changes in it.
Steps to file for overdue tax return:
- Arrange/collect tax documents. To apply for prior year tax returns you may need a form which you have received last year for tax pay.
- If there are missing documents then you must have to apply for them.
- Now you have to download a form (overdue tax return or for prior year tax return) from the website.
- Submit the form along with previous tax returns.
What if you failed to pay tax for three years?
If unfortunately you have not paid your taxes or file your business tax returns then government has rights to seal your bank accounts, to get over your house and property or wages until you clear up all the due or overdue taxes.
You can also apply or file for all the overdue tax returns like lodge tax returns, business tax return or personal lodge tax return. You can apply for these online as well as physically. However, lodge tax return online is much easier than physical, as you don’t need to spend much of the time in formalities and submission of the form. In the same way personal lodge tax return online is also very easy, you only need to do is to submit your application or form on the official website along with all the necessary documents.
If you also have failed to file for overdue tax return then government grants you six years to complete all the tax returns and to pay all the taxes otherwise you will be accused of jail or fine.