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Re: How to prove that you already paided tax as an individual in a partnership?

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Newbie

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Is there any other way to prove that my individual tax return already paid tax from the partnership?

Got audit recently and seems to be taxed twice.

example: my business which I run with brother make a profit of $50,000.

Each individual pay there fair share of tax $25,000 taxable income.

So $50,000 has already been accounted for and is tax as an individual.

but i received $50,000 into my personal bank account straight from  the business account.

How do I prove that it already been taxed? Already provided both individuals tax return,partnership tax return (shows up as a drawing in bias), and bank statement what else can I provide?

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ATO Certified

Master

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Maybe you can resolve without going to court like you say it costs money and i think there's a few steps you can take before it comes that. I found this on the website in the tax payers charter...

You may disagree with the way we are proposing to apply the law to your circumstances during a review or audit. There may also be occasions where tensions arise and you think we are not respecting your rights in the Charter.

If you feel this way at any time during a review or audit, tell the tax officer you are dealing with.

If you are unable to resolve the issue with the officer, tell that officer’s manager. The manager will review the issue and work with you and the tax officer to address your concerns.

https://www.ato.gov.au/print-publications/taxpayers--charter---if-you-re-subject-to-review-or-audit/...

If you still can't resolve there's an option to have an independent officer through an alternative dispute proceas.

I hope this helps!
23 REPLIES 23

Master

Replies 22

You shouldn't need anything further... sounds like you lodged the partnership return showing income of 50,000 and equal split of 25,000 going to each partner. If you both report this as partnership income on your personal tax returns for the same year than you shouldnt be getting taxed twice.

Newbie

Replies 21

Well it doesn’t seems that the case. It seems they want more evidence to back it up, what else can I provide to satisfy them. Because it went straight into my personal bank of $50,000 and I declared only $25,000. I think they are a bit confused that it already declared on my brother individual tax return.

 

Master

Replies 20

Did you transfer the whole 50,000 into your own bank account? Or did you transfer 25000 to yourself from the partnership and 25,000 to your brother from the partnership? If you keep records whether using accounting software or a spreadsheet you can show the ATO how you calculated your profit and the equal split with your brother. Have you both lodged your individual tax returns declaring the 25,000 profit from the partnership in each? The ATO are pretty reasonable when you are trying to do the right thing. Can you call your audit case officer and explain your situation? I'm sure they could tell you what evidence you need to substantiate your claims. You have nothing to worry about if you have reported everything and can justify how you calculated everything

Newbie

Replies 19

Over the course of the financial year I transfer a total of $50,000 to my personal account, my brother didn’t receive his share ($25,000) but it stated in his individual tax return that he declared that he got $25,000 from the business. My accountant has provided all the records already( bias statements, financial statement, bank statements both personal and business, ledger etc. We have both lodge our tax return already. I even came to a point were I got another accountant to reconstruct both my business and individual tax return. The result was the same. He even pin point every transaction from the business to my personal account. Try to explain it to this case officer but he having none of it. I don’t know if he wants to listen or not. My accountant is scratching is head thinking what else can he do.  Thinking of taking it to court, but will cost me a bit.

Best answer

ATO Certified

Master

Replies 0

Maybe you can resolve without going to court like you say it costs money and i think there's a few steps you can take before it comes that. I found this on the website in the tax payers charter...

You may disagree with the way we are proposing to apply the law to your circumstances during a review or audit. There may also be occasions where tensions arise and you think we are not respecting your rights in the Charter.

If you feel this way at any time during a review or audit, tell the tax officer you are dealing with.

If you are unable to resolve the issue with the officer, tell that officer’s manager. The manager will review the issue and work with you and the tax officer to address your concerns.

https://www.ato.gov.au/print-publications/taxpayers--charter---if-you-re-subject-to-review-or-audit/...

If you still can't resolve there's an option to have an independent officer through an alternative dispute proceas.

I hope this helps!
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Anonymous

Replies 17

@Farmeryee 

 

Are you still following this, as I may be able to assist ....

 

unfortunatley the information you have been provided is not usefull under your circumstances and everyone seems to have missed some important information ... 

Taxicorn

Replies 16

@Anonymous 

 

Welcome back

Anonymous

Replies 15

@macfanboy 

 

Thanks, but it won't be for long .... 

Master

Replies 14

@Anonymous Weclcome back

 

Can you provide the information that has been missed? It may help someone else in the future if they are experiencing the same problem and they come accross this thread

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