Failure to lodge tax returns on time could cost Australians up to $1650, with fines starting at $330 and compounding every 28 days. The Australian Taxation Office (ATO) urges citizens to act quickly or face interest charges and firmer enforcement action.
With just days remaining before the 31 October tax return deadline, hundreds of thousands of Australians are at risk of financial penalties. The ATO has reiterated that missing the deadline may result in fines, regardless of whether the tax return is submitted independently or via an agent.
In the 2023–24 financial year, the ATO issued over $935 million in failure-to-lodge (FTL) penalties, an increase of more than $300 million compared to the previous year, according to official figures. This warning arrives as more than 500,000 Australians have yet to lodge their returns for the 2024–25 financial year.
Late Submission Fines Increase Every 28 Days
The ATO imposes an initial FTL penalty of $330 if a tax return is not lodged by the 31 October deadline. This figure increases by $330 for every additional 28-day period the return remains outstanding, capping at $1650 for individuals. The penalties apply whether the return is submitted online, on paper, or through a registered agent.
According to the ATO, general interest charges (GIC) may also apply on unpaid penalties or tax debts. These charges are calculated daily at an annual rate of 10.61%, compounding daily, significantly increasing the amount owed if the return remains unsettled over time.
As of 14 October, more than 10 million taxpayers had submitted their returns, with 1.5 million lodged in the previous fortnight alone. Around 4.4 million were self-lodged, while over 4.2 million went through registered agents. The ATO expects to process around 15 million individual tax returns this financial year.
Despite the sharp increase in fines issued, the ATO says it does not automatically penalise all late lodgements. The ATO will consider your circumstances when deciding what action to take, noting that isolated cases or those involving extenuating circumstances such as illness or natural disaster may be eligible for remission of penalties.
Agents Offer Deadline Flexibility, but Only if Appointed in Time
For Australians unable to meet the deadline, working with a registered tax agent offers a critical alternative. Most agents are permitted to lodge returns beyond 31 October, often well into the next calendar year. However, individuals must engage an agent and be on their books before the deadline to benefit from this extension.
Assistant Commissioner Rob Thomson clarified a common misconception, saying: “There’s a bit of a myth that delaying lodgement of your tax return will buy you more time to pay – that’s not true.” For those who self-prepare, any outstanding tax bill is still due by 21 November.
Accountants and tax bodies, including CPA Australia and Chartered Accountants ANZ, have urged individuals with complex financial situations, such as rental properties, crypto assets, or side businesses, to seek professional advice. Tax agents can help navigate these complexities, avoid misreporting, and potentially prevent penalties.
Security remains another concern during the tax season. CPA’s Jenny Wong warned Australians to stay alert for phishing scams mimicking ATO communications. “Be wary of unsolicited SMS messages and emails claiming to be from the ATO, including those with hyperlinks and urgent calls to action, such as claiming you have a substantial refund to secure,” she said.
