Affected by the bushfires? The ATO will consider accepting your tax claims without documentary evidence this EOFY

June 23, 2020

The remains of a house destroyed by a bushfire in rural NSW. Source: AAP/Dan Peled.

The Australian Taxation Office (ATO) has moved to reassure businesses that lost tax records in the bushfire crisis that there will be discretion applied to income tax returns filed without documentary evidence.

About half of all rejected income tax returns are typically a result of a lack of evidence about what a business or individual has bought, or how it relates to their income.

But many businesses located in areas ravaged by bushfires earlier this year have had their tax records destroyed, or otherwise displaced.

These businesses may struggle to meet their end of financial year (EOFY) obligations.

ATO assistant commissioner Karen Foat says claims without evidence will be accepted in cases where records have been destroyed, although this will not be the ATO’s “general approach”.

“Whether you lost your files in floods or they were burnt in a bushfire, we are here to help,” Foat said in a statement.

“We understand people may be concerned that they will miss out at tax time if they can’t produce evidence to support their claims.”

Businesses are being advised to consider what other information might support their claims if documents such as receipts for purchases are not recoverable.

This includes bank and credit card statements, or other documents that “substantiate the nature of the claim” a business is trying to make.

“If you don’t have photos of your documentation, consider what other documentation you may have to support your claim, like bank statements,” Foat said.

“If you are unable to substantiate your claims because the records have been destroyed, we may be able to accept the claim if it’s not possible to obtain the original and if it’s not possible to use alternative documents to support your claim.”

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