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We’re aware of an issue affecting qualifying individuals who’ve amended their automatically issued income tax assessment. Currently, if an amended assessment results in an already refunded credit being reduced, penalties and interest are being incorrectly applied to the amount needing to be returned. This includes use-of-money interest (UOMI) – applied from the day after the refund – and late payment penalties (LPP), which are being charged 35 days later.

We’re currently working on resolving this issue and reversing any penalties and interest which have been charged incorrectly. We will provide an update here once we have more information. In the meantime, if you have a client affected by this issue, you should contact us to have their account corrected.

Qualifying individuals and amending assessments

Due to legislation changes earlier this year, the process by which qualifying individuals (being those who only receive reportable income or who are treated as such in a tax year) can amend their automatically issued income tax assessments has changed.

These customers can now amend their assessment at any time before their terminal tax date without facing penalties or interest. This includes use-of-money interest (UOMI) and late payment penalties (LPP).

If these changes result in an amount to pay, they’ll have until their terminal tax date to make this payment. After the terminal tax date, UOMI and LPP will be applied.

You can find more detailed information on the legislation changes around modernising tax administration and how they affect qualifying individuals (including when non-qualifying individuals might be treated as such, here:

TIB Vol 31 No 4 - May 2019