Find out what tax audit insurance is and compare instant online quotes through Savvy.
Fact checked
We’ve partnered with BizCover to bring you a range of business insurance policies to help you compare them side by side.
Every year, the Australian Taxation Office conducts an audit of more than 120,000 small businesses, meaning all businesses can expect to be audited once every three years on average. Such audits can be time-consuming and are dreaded by most small businesses, as they take up the valuable time of accounts staff or necessitate hiring an additional accountant or bookkeeper.
However, you can cover your business against this cost by taking out tax audit insurance. Compare a range of quotes for tax audit insurance here with Savvy so your business is covered when you get the call. Considering your options with us will help you choose the best insurer. Sort out the cover your business needs today.
Tax audit insurance is a form of business insurance which covers you for unexpected costs associated with responding to a compliance audit, or the audit of a tax return you’ve lodged with the Australian Taxation Office. Such audits can be conducted by the ATO up to a maximum of five years from the date you lodged your tax return.
Audits can involve hours of sifting through receipts and filling in forms and often require employing a tax agent, accountant or bookkeeper to provide the financial information requested. These additional costs are covered by tax audit insurance.
In past years, the ATO mainly targeted big businesses for audits, but increasingly now small and medium-sized businesses are being audited. For this reason, tax audit insurance is becoming more popular.
By answering a few questions about your business, you can have a range of instant quotes for tax audit insurance right here with Savvy. Our quick and convenient service means you can compare quotes online from some of Australia’s most respected insurers. Alternatively, you can also include tax audit coverage as part of your bundled business insurance package to help your business save on insurance overall.
This insurance covers the costs associated with responding to an audit request. This can involve employing a tax agent, accountant or another financial professional to assist you with your audit response.
It isn’t only tax returns that can be subject to a compliance audit. Tax audit insurance can also cover your business for the following issues:
For example, a personal and fitness trainer was informed she was subject to an ATO audit. She was required to produce three years’ worth of income statements and, at the end of the three-month process, was presented with a $6,500 bill from her accountant. Her audit insurance covered this cost.
If you’re subsequently charged with an offence following the audit, there may be additional costs incurred to hire a lawyer to defend yourself or your company against any allegations. All such professional fees may be covered by tax audit insurance.
Some of the areas not covered by tax audit insurance include:
Therefore, if you do receive the dreaded phone call or letter from the ATO saying you are going to be audited, it makes sense to employ professionals to assist your business to respond to audit requirements, as their fees will be covered by your insurance.
For example, a business in Darwin received a phone call from the ATO saying that some of its casual employees had complained about too much tax being withheld from their wages. The owner was required to produce documentation for the past two years showing all wages paid to all casual workers, with details of tax withheld, and had to employ a tax agent for three weeks to assemble all this data. Luckily, they had tax audit cover included as part of their small business insurance package, so this covered the entire cost of hiring the tax agent.
This will depend on what level of cover you choose to take out, with most insurers offering cover ranging from $10,000 to $50,000. The following factors will also influence the level of coverage you may need:
Naturally, the more complex your business structure and the larger your company is, the more costly a potential audit could be and the higher the level of cover you may need.
In determining what level of cover is appropriate for your particular situation, consider how much it could cost you to comply with audit requirements. Professional fees for accountants can be anywhere from $300 an hour upwards, depending on the level of professional assistance you’ll require, so they can quickly add up if you require many hours of work to comply with audit requirements.
Find the best possible insurance coverage for your business quickly and easily here with Savvy's 100% free comparison service.
With multiple trusted insurance partners across the country, you can enjoy high-quality online comparisons all in one place right here.
Skip the hassle and save time and money by comparing with Savvy to get instant online insurance quotes for convenient comparisons.
Disclaimer:
Savvy is partnered with BizCover Pty Ltd (ABN 68 127 707 975, AFSL 501769) to provide readers with a variety of business insurance policies to compare. Savvy earns a commission from BizCover each time a customer buys a business insurance policy via our website. We don’t arrange for products to be purchased from these brands directly, as all purchases are conducted via BizCover.
Savvy does not compare all business insurance policies or providers currently operating in the market. Any advice presented above or on other pages is general in nature and doesn’t consider your personal or business objectives, needs or finances. It’s always important to consider whether advice is suitable for you before purchasing an insurance policy.
For any further information on the variety of insurers compared by BizCover or how their business works, you can read their Financial Services Guide.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
© Copyright 2024 Quantum Savvy Pty Ltd T/as Savvy. All Rights Reserved.
Quantum Savvy Pty Ltd (ABN 78 660 493 194) trades as Savvy and operates as an Authorised Credit Representative 541339 of Australian Credit Licence 414426 (AFAS Group Pty Ltd, ABN 12 134 138 686). We are one of Australia’s leading financial comparison sites and have been helping Australians make savvy decisions when it comes to their money for over a decade.
We’re partnered with lenders, insurers and other financial institutions who compensate us for business initiated through our website. We earn a commission each time a customer chooses or buys a product advertised on our site, which you can find out more about here, as well as in our credit guide for asset finance. It’s also crucial to read the terms and conditions, Product Disclosure Statement (PDS) or credit guide of our partners before signing up for your chosen product. However, the compensation we receive doesn’t impact the content written and published on our website, as our writing team exercises full editorial independence.
For more information about us and how we conduct our business, you can read our privacy policy and terms of use.
