Tax Audit Insurance
Tax Audit Insurance
Tax audits are detailed examinations conducted to verify the accuracy of information submitted to the Australian Tax Office (ATO) or other authorities. Each year, the ATO increases its audit activity, focusing on claims that seem “dodgy” or inconsistent. Areas of particular interest include earnings from cryptocurrencies, ride-sharing apps, work-related expenses like fuel and dry cleaning, and deductions related to investment properties.
Several triggers can lead to an ATO audit for both businesses and individuals, including:
- Not declaring capital gains from property or shares
- Undeclared foreign income or interest from bank accounts
- Undeclared earnings from small businesses
- Incorrectly claiming deductions
- Having a lifestyle that exceeds declared income
- Claiming deductions for rental properties without proper documentation
In 2018, hundreds of thousands of Australians received letters from the ATO due to undeclared income or unusual claims, and the number of audits is expected to rise.
Planning ahead, keeping detailed records, and ensuring all income and deductions are accurately reported can help you avoid the scrutiny of an audit.
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What is Tax Audit Insurance?
Tax Audit Insurance provides protection from the costs associated with an unexpected audit. If your business is audited, you may need to compile various documents related to company structures, ownership entities, financial flows, and asset acquisitions. Supporting documents such as explanatory notes, detailed calculations, and legal interpretations might also be required to justify claimed deductions.
This process is often time-consuming and requires the assistance of professionals like accountants or lawyers, which can be expensive. Tax Audit Insurance covers these costs, ensuring you’re not financially burdened when dealing with the audit process and allows you to stay in control while engaging necessary professionals.
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How Can I Purchase Tax Audit Insurance?
We have partnered with Guild Insurance to offer our clients comprehensive Tax Audit Insurance with a competitive premium. As a 100% Australian-owned insurer, Guild Insurance brings a team of specialists familiar with the intricacies of the Australian tax system.
The Guild Tax Audit policy covers professional fees incurred during audits for:
- Income Tax
- Capital Gains Tax
- Land and Payroll Tax
- BAS/GST Compliance
- Workers Compensation/WorkCover
- Self-Managed Superannuation Funds
- Fringe Benefits Tax
- Stamp Duty
Key benefits of the policy include:
- Coverage for Income Tax
- Capital Gains Tax
- Land and Payroll Tax
- 24/7 claims support
- No excess fees
This partnership ensures that our clients receive robust financial protection and expert support during tax audits.