Get the Facts on Amending a Tax Return (Myth Included)

Fact #1: You can fix it

Don't panic if you've made a mistake on your tax return. The Australian Taxation Office (ATO) allows you to amend your return if you've:

• Left out income (like bank interest, side jobs, or rental income)
• Forgotten to claim a deduction or offset
• Entered the wrong amounts by accident

Mistakes happen, and the ATO knows that. The important thing is to correct them as soon as you notice. You don't need to lodge a whole new tax return, just an amendment.

Fact #2: There are time limits

You don't have forever to fix a mistake. In most cases, you have two years from the date the ATO issued your notice of assessment to make a change.

But there's a recent update for sole traders:

• From the 2024–25 income year, sole traders will have four years to amend their return.
• For returns from earlier years, the usual two-year limit still applies.

If you're outside the time limit, all hope is not lost, but you'll need to request an amendment directly from the ATO, and they'll decide whether to allow it.

Fact #3: Online amendments are possible

If you lodged your return using myTax through the ATO website, you can usually amend it yourself online. The process is straightforward, and the ATO provides step-by-step instructions.

But if you used a tax agent (like us) to lodge your return, your agent will need to make the amendment for you. You won't be able to do it yourself through myGov in that case.

Either way, the change gets sent to the ATO, and they'll issue a new notice of assessment once it's processed.

Fact #4: Interest or penalties may apply

If the error on your tax return meant you underpaid tax, the ATO might charge interest, and in some cases, penalties too.

This usually happens when:

• The mistake seems careless or intentional
• It's part of a pattern of errors from previous years
• You gained a financial advantage by not reporting something correctly

Even if you amend your return yourself, the ATO can still apply penalties if they believe the mistake should've been avoided. That's why it's always best to double-check your return or get help from a tax professional.

Fact #5: Amendments can go both ways

Amending a return isn't just for fixing underpayment; it can actually work in your favour, too.

If you realise you:

• Forgot to claim a deduction or offset
• Over-reported your income
• Missed something that could lead to a refund

…you can amend your return and potentially receive a refund.

So don't assume that fixing a return always means you'll owe more. Sometimes, it can mean a pleasant surprise in your bank account.

The Myth: "If I fix it quickly, the ATO won't care."

We often hear this, but unfortunately, it's not true.

Many people think that if they spot a mistake early and fix it quickly, the ATO will overlook it. While it's always better to fix errors sooner rather than later, the ATO still takes accuracy seriously.

Even if you amend your return yourself, the ATO may:

• Ask questions
• Apply interest or penalties
• Flag repeated mistakes for future review

In short, a fast fix doesn't guarantee a free pass. That's why it's best to get it right the first time or get help early if something doesn't look quite right.