Accountants frustrated by ATO delays

Accountant may seek compensation from the Australian Taxation Office (ATO) as a result of damage to their reputation and bottom lines following problems flowing from the ATO’s switch to a new IT system.

Thousands of Australians have experienced delays in receiving tax refunds this year as a result of problems associated with the ATO’s administrative changes.

accountantsRus chief executive Adrian Raftery said he wouldn’t “be surprised if tax agents seek their own compensation from the ATO after experiencing several problems with the upgrade since Christmas”.

“In the past four months, accountants have spent a considerable amount of non-chargeable time, had their goodwill and reputation damaged, increased stationery costs and experienced their own cash flow issues whilst waiting for payment for services,” Raftery said.

Raftery said in addition to not being paid, accountants were being “abused” by clients concerned about the status of their refund. Raftery said he is aware of some taxpayers “who have lodged complaints thinking that their accountant [is] fraudulent by pocketing refunds for themselves rather than passing them on”.

The delays have some left some Australians in significant financial hardship.

Raftery said in some cases taxpayers had waited up to three months for tax refunds, while other problems included incorrect due dates being issued on notices of assessments, giving insufficient time for taxpayers to pay their outstanding tax. Some taxpayers are also waiting for overdue benefits from Centrelink and the Family Assistance Office.

Recently, 140,000 people received a letter notifying them of their tax refund, but without the associated cheques attached. The ATO said those cheques would be with Australia Post by today.

ATO second commissioner David Butler said the tax office was working hard to resolve the issue.

“Our staff are putting in an extraordinary effort to minimise the impacts of any delays on the community. We have brought in an additional 320 people, have extended work shifts and are working as much overtime as is possible. We are in the process of bringing on an additional 500 temporary people over the next few weeks,” Butler said.

The ATO said it had been working to ensure refunds are paid as a priority to people experiencing financial hardship. The tax office said it had already assisted more than 1,000 people who were in that situation.

The ATO switched to a new IT system earlier this year, replacing the previous system which had been in place for more than 30 years.