In considering which large businesses may need to be reviewed and the frequency and intensity of the review, we assess the relative likelihood of you not meeting your tax obligations and the consequences of potential non-compliance. All large businesses are grouped into one of four broad risk categories each of which, from our perspective, has a suggested compliance approach for us to take - see How we manage tax risk.
How we seek to understand your business
We recognise that to establish a foundation for achieving cooperative compliance in the large market, we need a well-developed and thorough understanding of the world in which you operate and the realities of the commercial environment.
We recognise that large business operates in a dynamic social, political and economic environment. Understanding these factors, as well as the policy, legislative and administrative processes of the law, enables us to make more informed judgments on large business behaviour and its possible impact on compliance.
We use the 'business, industry, sociological, economic and psychological' (BISEP) model to help us consider business behaviour. These broad areas reflect the fact that your compliance decisions are affected by a wide set of related factors - see figure 5.
Additionally in our risk profiling, which we undertake twice a year, we consider a number of other factors including your effective tax rates, your major transactions and other interactions with us, which we derive from a range of public and tax return data. We also undertake research to better understand issues possibly impacting on your compliance, see How we manage tax risk.
Sections within Our approach
Last Modified: Wednesday, 27 February 2013