Many taxpayers have grown used to the Australian Taxation Office (ATO) taking a fairly relaxed approach when it comes to remitting interest charges (GIC & SIC) and failure to lodge (FTL) penalties. In fact, it’s almost expected that if you ask for a remission, the ATO would simply say yes. Those days are over.
What’s changed?
The ATO is taking a firmer view on taxpayers meeting their obligations, lodging on time and paying on time. Plus, they’re looking much more carefully at remission requests.
To even be considered, taxpayers now need to show genuine, documented reasons for running late. We’re talking about serious events such as illness, natural disasters, financial hardship, family crises or situations completely outside the taxpayer’s control.
If you can’t back it up with evidence (think medical certificates, financial statements, court documents or police reports) the ATO is likely to say no.
Why does this matter to you?
The ATO’s systems don’t just track your lodgement dates, they also track your history, your patterns and even the assets you own. That history will play a role in their decisions. Someone with a long track record of lodging late, or ignoring reminders, is less likely to be granted a remission than someone who has consistently done the right thing.
And as of 1 July 2025, general interest charge (GIC) is no longer tax‑deductible, which makes it even more expensive when balances start to snowball.
How to avoid the penalties
To help you avoid unnecessary penalties, the most important thing you can do is give the information your accountant needs to them, early.
We’re here to keep you ahead of deadlines, but we can only do that if we have the full picture. When information arrives late, rushed or incomplete, it puts pressure on both sides and increases the risk of missing ATO due dates.
The advantage of using a tax agent
The good news is that if you nominate a tax agent, such as us, you get extended lodgement and payment deadlines under the ATO’s agent program. These extensions can mean the difference between lodging on time and lodging late.
What if you still need a remission?
A remission request is still possible, but the ATO will only consider it where the circumstances clearly justify it. And even then, approval isn’t guaranteed.
If you believe you have a valid reason, we can help prepare the correct application forms and submit them through the appropriate ATO channels. But the key is evidence, without it, the ATO won’t budge.
Final thoughts
The ATO’s tougher stance isn’t about catching people out, it’s about encouraging better habits and making sure everyone is playing by the same rules. With the right preparation and timely communication, there’s no reason these penalties should ever become a problem. Staying organised, sharing information early and leaning on your tax agent means you can keep ahead of deadlines and out of the ATO’s firing line.
Let’s get you on track
If you’re unsure where you stand, think you may be exposed to penalties, or simply want to tighten things up before the next lodgement cycle, we’re here to help. Reach out to our team at Cutcher & Neale and let’s make sure your lodgements are timely, accurate and penalty free.
Nicole Brown has more than 23 years of experience in accounting and financial services, specialising in medical professionals and niche industries. Personalised, client-focused, and trusted, she builds strong client relationships, offers clear guidance, and ensures strategies align with long-term financial objectives.
