Is your tax return accountant liable for mistakes?

If you have hired a tax return accountant to complete your return, you expect that the work will be done properly. However, sometimes either intentionally or unintentionally, the tax return accountant could make a mistake on your tax return that may get caught by the ATO which could result in certain tax penalties.
After some alterations in law over a decade ago, anybody who prepares a tax return could be held liable for mistakes in the preparation of a return for someone else. A tax return accountant who made mistakes in your return could be subjected to an ATO monetary penalty. The accounting services provider may also get a non-financial penalty, like being unable to prepare any returns for some time.
This is an informative blog on the topic of what you must do if your accountant makes a mistake, and what is their liability?

Tax Return Accountant made a mistake – What may happen?

Here lies the twist! If the tax preparer makes a mistake, you must bear the penalties. If the mistakes were caused due to the omission of data from your end, you must work with your accounting services professional to make the corrections.
On the other hand, if the mistakes were caused by the tax preparer, you would be required to notify him about the correspondence that you’ve received from the ATO.
The professional accountant must analyze the mistakes by taking necessary measures. Such measures include filing an amended return at no extra charge. You must check the contract that you have already signed with the tax return accountant that mentions their liabilities.

As per ATO, below are some examples in which you may report your tax return accountant:

·       * Creating some alterations in the tax return data

·        * Creation or omission of income

·        * By creating false exemptions, generating large refunds

·        * Failure in signing tax returns they file and prepare

·        * Inability to provide a copy of the tax return to the client when they ask

·        * Waiting or holding the record of the client for some time for the preparation fee    to get paid

It depends upon you that how well you may convince the ATO about the negligence of a tax return accountant.
The ATO may then investigate and if it finds anything wrong, the license of a tax return accountant could be rescinded.

Can I sue a tax return accountant?
It is often the last resort as the taxpayer has to pay a certain legal fee. But, if the tax return accountant is not registered by the ATO or state-licensed, the only step is to take legal action. You may file a standard professional malpractice complaint with the state court in your jurisdiction.
To avoid dealing with such problems, it is the best option to research the candidate and find the best that suits your requirements. Like, if you deal with complex financial situations, you might need regular consultations by accounting services professional. 

If the tax return accountant has made a mistake, who will pay?
Originally the taxpayer is held responsible for additional income tax, but the tax return accountant could be held liable for the additional penalties in the form of interest and liabilities. According to economics, the tax preparer is left with certain small claims court as the only viable economic option.

What you must do if your tax return accountant makes a mistake?
Bring the matter to the attention of the tax preparer and quite often an amended return is warranted to correct the mistake. The reputable preparers cover the penalties and interest related to their own mistakes. 

Contact us to get the services of our tax return accountants
The tax laws are quite complex. So it is understood that mistakes may occur. But the ATO is not forgiving. Therefore, an efficient accountant must stay alert while filing the taxes.
The tax return accountants at Reliable Melbourne Accountant are enthusiastic enough that they are focused during the tax season and assure that you never have to face any hurdles in the path of success for your business. We know how to sort out the law and certain facts in tax controversy and take care of your rights with the ATO.

Call us now to grab our incredible services.