Case Study 2: Recouping Overpaid Tax

The problem

Our client ran a newsagency that sold lottery tickets and was paid a commission by NSW lotteries.

When we were appointed by the client, we reviewed the books, and realised that their previous accountant hadn’t taken the time to understand the newsagency industry and treated the monies collected from customers as ordinary taxable income, but in fact only lottery commissions needed to be treated as the newsagency’s income. In other words the client was over declaring income and overpaying taxes and GST.

What did we achieve?

Using our many years of tax experience and industry knowledge we broke down the “commissions process” and understood what was required to recoup overpaid taxes.

We built a strong case and presented our findings to the Commissioner of Taxation, and were successful in recouping tax, GST, and other flow through taxes to the clients benefit for the past 4 years.

Thus, we were able to claw back both overpaid GST and income tax from the ATO, almost to the value of $120,000.