At some point during your business operation, you can get a notification from the Australian Taxation Office (ATO) that your office will undergo a tax audit. Most often than not, those who are subjected to tax audits are chosen randomly. However, there are instances when subjects are selected based on the possibility that the submitted tax documents have some questionable entries. Tax audits are conducted to guarantee that your presented tax statements are true and reliable. The process, will incur payments for the professional fees and other expenses. The person or institution being subjected to tax inquiry has to shoulder the expenses. Because organizations and individuals do not want to get financially surprised, they purchase tax audit insurance to cover the fees and for them to remain financially stable even with the tax audit process.
A tax audit insurance is a professional service that one can obtain from insurance companies to accountants and their clients for financial protection in the event that their business or the person is subjected to random tax audit by concerned government agencies.
Having a tax audit insurance is not mandatorybut the service is offered by tax insurance companies to financially assist companies and individuals during the audit which can incur huge amount of money.
With a company for tax audit insurance, you or the business firm will be assisted all throughout the process which can involve financial enquiries, review, investigation and audit by ATO. The government agency will check the subject in terms of tax compliance and lodged tax statement. The insurance company can also provide professional assistance to their clients even if the query is conducted over the phone. By having a tax insurance company, clients can have an institution that will assist them thru the process. This gives the subject the peace of mind and confidence during the audit.
The services offered by tax audit insurance can be obtained by accountants and even by non-accountants. For accountants, they have to fill out a form so they can be contacted by representatives from the tax audit insurance company. For non-accountants, they can just inform their accountant to get in touch with the insurance company.