Rushing your tax? Why early birds aren’t getting the worm come tax time

The Tax Office issued corrections for over 140,000 personal returns last year, identifying errors spanning government benefits, investment yields, salary earnings, and health insurance details. 

Furthermore, the Tax Office’s sophisticated data-matching initiatives resulted in corrections to over 595,000 personal filings, addressing omissions in declared income, inflated deduction claims, and various other inconsistencies. 

Speaking with Accountants Daily, ATO assistant commissioner Anita Challen was pressed on why so many Australians continue to lodge their tax returns early despite the increased risk of errors and delays. 

“One of the biggest myths at tax time is that the earlier you lodge your tax return, the earlier you’ll get your refund … this actually isn’t true,” Challen warned. 

“The ATO pre-fills key information you’ll need, like your wages, health insurance and interest from banks in your tax return, so waiting until late July to submit means you are less likely to forget a piece of income.” 

For the quickest and most seamless lodgment, the ATO recommended waiting until late July or early August. 

In doing so, the majority of third-party data is integrated into tax returns, encompassing salary earnings, banking interest, government benefits, and private health insurance particulars.

Whilst a large majority of Australians have already lodged their tax return, Challen noted that if an individual discovers that their premature lodgment contains errors, it is possible to rectify their return once it has been processed.

“If you need to amend your tax return, there are a range of ways taxpayers can do so, including online through ATO online services, by paper, through a registered tax agent or by sending us a letter.”

“Taxpayers will need to wait until their original tax return is processed before submitting the amendment.”