A finished company job. Two errors still inside.
Taxpartna reads the whole job, including the return, the financials, the ASIC statement and the workpapers, and checks each document against the others. Here are two errors that made it through to sign-off in a demo company file, and how each was flagged before lodgment.
Watch the 48-second demoWatch how Taxpartna catches two errors in a finished company job.
Demo review of Demo Holdings Pty Ltd: 12 documents read, two discrepancies flagged. Here is what it found: directors that don’t match ASIC, and a base rate entity flag that no longer holds.
The director who isn’t on the register
The ASIC company statement lists Peter Smith as the sole director. The financial statements, both the Director’s Report and the Director’s Declaration, name Sophie Smith as the director.
Why it matters
Financial statements signed by someone ASIC doesn’t record as a director can be rejected when a bank or lender runs its KYC checks. That can hold up finance until the financials are corrected and re-signed.
What Taxpartna checks
- Every director named in the Director’s Report and the Director’s Declaration
- The officeholders listed on the ASIC company statement
- Mismatches in either direction, including misspelt names
A base rate entity that isn’t one this year
The return was lodged with “Base rate entity: Yes” and the 25% rate. But this year the company had a $215,000 net capital gain and $20,000 of interest, out of $283,093 of assessable income. That makes its base rate entity passive income 83%, over the 80% limit.
Why it matters
A company that isn’t a base rate entity pays tax at 30%, not 25%, and its maximum franking rate changes too. If the wrong rate goes out, the result is an amendment, shortfall interest and an unexpected conversation with the client.
The numbers: $215,000 net capital gain + $20,000 interest = $235,000 of passive income, which is 83% of $283,093 assessable income. Over 80%, so the company is not a base rate entity for this year.
A flag, not a ruling
Taxpartna marks each item as a Discrepancy and shows the documents and figures behind it. Correcting the directors, re-signing the financials and confirming the company’s tax rate remain decisions for the practitioner.
Getting the best result: for company reviews, upload the financial statements, the full tax return, the ASIC company statement and the workpaper pack, plus any ATO account statements and tax planning notes. The full upload list is in the user guide.
Why these errors slip through
They sit across documents
Neither error is visible on any single page. Each only shows up when one document is checked against another.
The forms get filled on autopilot
The base rate entity flag and the director details are often carried over from last year and not looked at again.
The income mix can change in a year
A company that has always been a base rate entity can fail the 80% passive income test after a one-off capital gain.
Someone else will check
Banks and lenders verify directors against ASIC, and the ATO data-matches what’s lodged. Better that it’s found before then.
Run your next completed company job through Taxpartna.
Illustrative demo data. No client or firm is identified. Base rate entity rules and company tax rates can change; check current ATO guidance.