Guide to correcting mistakes and disputing decisions
Guide to correcting mistakes and disputing decisions
There are times you can make a mistake on the various tax and superannuation returns, statements and other reporting documents you lodge with us. We always accept that you are trying to be honest in your tax affairs and that the information you provide is complete and accurate, unless we find evidence of carelessness, recklessness or intentional disregard of the law.
We also know there will be times you will need to make a change because circumstances have changed. And some people who did not reveal all their income or incorrectly claimed deductions will want to set their tax affairs in order.
The important thing is that as soon as you realise the information you have given us is no longer accurate, you act to correct it.
There may also be times when you disagree with a tax assessment, a penalty, an interest charge on an unpaid debt or some other decision we have made about your tax affairs, including a private ruling. There are various avenues available to you to have these decisions reviewed if you are not satisfied with them.
Contact us with your concerns
Regardless of your legal rights, the first thing you should do is contact us. Many misunderstandings and disagreements can be resolved by talking to us. There is always a contact phone number on the letter or statement you have received.
Correct (amend) an income tax return
There are many reasons you may need to fix a mistake in an income tax return you have already lodged. The way to do it is to ask for an amendment to your tax return.
Correct an instalment or business activity statement (BAS)
How you make corrections relating to GST, the luxury car and wine equalisation taxes, fuel tax credits, and pay as you go withholding or instalments - or claim outstanding credits. You can correct many GST and fuel tax credit mistakes on your current activity statement.
Correct excise and FBT returns, non-BAS fuel scheme claims and PAYGW payment summaries
How you correct non-BAS fuel tax credit claims and claims under the Product stewardship for oil program, Cleaner fuels grants scheme and Energy grants credits scheme. Also, how you fix mistakes on excise and fringe benefits tax (FBT) returns and pay as you go (PAYG) withholding payment summaries.
Make a voluntary disclosure
What you need to do to tell us about misleading statements you have lodged or mistakes or omissions in tax returns or other statements that increase your tax when rectified. Telling us allows you bring your tax affairs into order and you are likely to be entitled to concessional treatment of any penalties and interest charges that apply.
How to correct a mistake - summary
A summary of the methods explained in the above sections for correcting information you have given us and of the reasons for making corrections. Always keep all records relating to your correction.
Dispute (object to) an ATO decision
You often have a legal right to an internal review (through our objection process) of a decision we have made about your tax affairs, such as tax assessments and private rulings. Your objection is considered by an area that is separate from and independent of those involved in the original decision.
Seek an external review of our decisions
The law specifically gives you the right to go to the Administrative Appeals Tribunal (AAT) or the Federal Court for a review of some of our actions or decisions. In most cases you need to have lodged an objection with us first. There are also forms of external assistance.
Request remission of interest charges or penalties
We can remit (reduce or cancel) many penalties and interest charges if it would be fair and reasonable to do so. If you are dissatisfied with an interest charge or a penalty, you may ask us to remit it.
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Change personal or business details or make a complaint
To correct or change our records of your:
To add a new business account for goods and services tax (GST), fuel tax credits (FTC), pay as you go (PAYG) withholding, luxury car tax (LCT), and wine equalisation tax (WET), refer to:
To cancel a business registration, lodge an:
To make a complaint, refer to:
If you are a registered agent who wishes to lodge a complaint, refer to Registered agent complaints.
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Contents: Guide to correcting mistakes and disputing decisions
Overview
Contact us with your concerns
Correct (amend) an income tax return
Amendments
Correct an instalment or business activity statement
Unclaimed refunds and credits
Revising an earlier activity statement
Goods and services tax (GST)
Fuel tax credits
Correction limits for GST and fuel tax credits
Luxury car and wine equalisation taxes
Pay as you go (PAYG) withholding
Pay as you go (PAYG) instalments
Correct excise and FBT returns, non-BAS fuel scheme claims, payment summaries
Excise returns
Fringe benefits tax (FBT) returns
Fuel scheme claims
PAYG withholding payment summaries
Make a voluntary disclosure
How to make a voluntary disclosure
How we process your voluntary disclosure
GST, WET and fuel tax credit disclosures
Penalties and interest arising from voluntary corrections
Difficulty repaying a voluntarily disclosed debt
How to correct a mistake - summary
Reasons for corrections
Time limits
Record keeping
Dispute (object to) an ATO decision
Independent internal review
Decisions you cannot dispute using the objections system
Decisions you can object to, and time limits
Extension of time to object
How to object to a decision
How we process your objection
Seek an external review of our decision
Administrative Appeals Tribunal (AAT)
Federal Court and Federal Magistrates Court
Time limits
Evidence
Test cases
More information
Other avenues available to you
Request remission of interest charges or penalties
Remission of interest charges
Remission of penalties
Contact us with your concerns
If you disagree with your assessment or other decision we have made about your tax affairs, there are a number of avenues the law gives you to challenge our decision. These are explained in this document.
Regardless of your legal rights, the first thing you should do is contact us. It is usually faster and easier to sort out misunderstandings and disagreements this way. If you think there has been a mistake, simply ask us to correct it. If we disagree that it is a mistake, you still have the right to ask us to review our decision.
When we give you a decision about your affairs, we explain how you can get the decision reviewed and tell you if there are time limits.
If there are several review options, we explain how these differ. For example, some reviews look at questions of law and others involve checking that we followed the correct process in reaching the decision.
We try to resolve any problems as quickly as possible. If we have made a mistake, we want to fix it at the least cost to both of us.
There is always a contact phone number on the letter or statement you have received. If you don't want to deal with the tax officer who has been handling your case, ask to speak to their manager or contact our complaints area.
You can also seek external assistance or an independent review by an external authority, see Seek an external review of our decisions.
Correct (amend) an income tax return
There are many reasons you may need to correct a tax return you have already lodged. For example, if you:
- receive a revised payment summary or another payment summary after you have lodged your return
- realise you made an error when completing a question
- forgot to include
- a capital gain or capital loss
- the value of a reportable fringe benefit
- some income you received, such as interest from a bank account or fuel tax credits (which are part of your business income)
- forgot to claim
- an allowable deduction
- a tax offset you are entitled to
- have repaid an amount you were overpaid.
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Correction or dispute?
You use the amendment process to correct a mistake or omission on your tax return. To dispute the facts or the law you use the objection process. For example, if you disagree with your income tax assessment and want to dispute it, you need to lodge an objection to it.
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Amendments
'Amendment' is the term we use for a change made to an income tax assessment. For corrections to most income tax returns you need to write to us requesting an amendment to your assessment, unless you are amending a self-managed super fund (SMSF) return or you use a registered tax agent.
Amendments
'Amendment' is the term we use for a change made to an income tax assessment. If you want us to change your income tax assessment you need to write to us asking for the amendment, unless you:
You also request an amendment if you think we have made a mistake processing your tax return, unless we can sort it out over the phone.
You can amend an assessment more than once.
Amendments are part of the self-assessment system. That is, just as we accept your tax return information at face value, in most cases we do the same with the information you provide on your request for an amendment.
If your amendment decreases the tax you owe, you will receive a tax refund (unless you have other tax debts). If it increases the tax you owe, we generally treat it as a voluntary disclosure of unpaid tax. This means you are likely to receive concessional treatment for any penalties and interest charges that apply. (You will still have to pay any outstanding tax and may have to ask for the concessional treatment of interest charges.)
The result of an amendment is a new notice of assessment, which we call a notice of amended assessment. It shows the new amount payable or refundable.
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Amend or object?
You use the amendment process to correct a mistake or omission on your tax return. You would consider lodging an objection if you wanted to dispute the law or the facts we have used to come to a decision about your tax affairs (including your income tax assessment).
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Time limits
There are time limits for making amendments to your tax return, generally two years for individuals and small businesses and four years for other taxpayers. To give you certainty about your tax affairs, the law does not allow amendments (initiated by us or by you) outside the time limit, but you may be able to lodge an objection instead.
How to request an amendment
To request an amendment you can use one of the forms we provide or write a letter. If you write a letter, you need to make sure you include all the information we need. You can authorise someone else to request an amendment on your behalf. There is no fee for requesting an amendment.
How we process your amendment request
It can take up to eight weeks to process your amendment, depending on how you lodged it and whether it arose because of a clerical or administrative error on our part.
SMSF amendments
We do not accept requests in letter form asking for changes to the self-managed super funds (SMSF) annual return.
Starting with returns for the 2011 income year, your tax agent can submit SMSF amendment requests through our electronic lodgment service (ELS).
If you don't use a tax agent or your amendment relates to an earlier income year, you must use the paper return form, SMSF annual return (NAT 71226) to submit your amendment - even if your tax agent lodged the return through ELS.
Complete the form in full, not just the parts you want to change. Let us know it is an amendment by checking 'Yes' at question 5.
Registered tax agents
Registered tax agents can use the electronic lodgment service (ELS) to lodge amendments to income tax and fringe benefits tax returns for all taxpayers, starting with amendments to the 2011 income year:
- individuals
- companies
- partnerships
- trusts
- superannuation funds
- SMSFs.
They can also use ELS to lodge amendments to income tax returns for earlier years for individuals.
Time limits on amendment requests
There are time limits set by law for amending your tax return. These are:
- for individuals and small businesses - generally two years starting from the day after we give you the notice of assessment (generally taken to be the date on the notice)
- for other taxpayers - four years starting from the day after we give you the notice of assessment.
For example, you are a sole trader and receive a notice of assessment dated 12 November, 2010. Your two-year amendment period starts on 13 November 2010 (the day after the date on the notice) and ends two years later, 12 November 2012, so you have until that day to lodge a request for an amendment to that return. If you were a company you would have until 12 November 2014. (Technically we can't amend the return after that date; however, if we receive your request for an amendment on or before the final date, we normally process it.)
You can submit more than one amendment request within your time limit.
This time limit for amending is designed to give you certainty about your tax affairs because it means we cannot amend your tax return after the time limit has passed (except in some exceptional situations such as evasion or fraud).
If you want to change a tax return after the time limit has passed, you may be able to lodge an objection. The time limit for lodging amendments and objections is the same; however, the law allows you to request an extension of time to lodge an objection in some circumstances.
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If you send us an amendment outside the amendment period, we will send you a letter advising you that we cannot process it but you can lodge a late objection instead.
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How to request an amendment
Requests for amendments must be in writing. There is a paper form individuals can use and both paper and online forms tax agents can use on behalf of all types of taxpayers. Partnerships, trusts, companies and super funds need to write a letter if they don't use a tax agent.
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Even if you used e-tax to lodge your tax return, you cannot amend it through e-tax - you must contact us in writing. Using the form will make it simpler.
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You need to know:
There is no fee for requesting an amendment and you don't have to send another tax return unless we ask you to.
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Keep a copy of your request for your records.
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Forms
To request an amendment:
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Prior year returns
For 2010 and prior years, tax agents can use ELS only to lodge amendments to individual returns, not returns for other taxpayer types.
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Who can sign an amendment request
The acceptable signature on an amendment request varies depending on whether the request is done online or on paper.
Online lodgments must contain the electronic signature of your tax agent.
The signature on a paper amendment depends on who is lodging the request, see table.
Who is lodging
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Who must sign
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Tax agent
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The tax agent (they must have a declaration from you that the information you gave them was true and correct)
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Legal personal representative
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The representative
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Individual
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The individual
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Partnership
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A partner
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Trust or fund
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A trustee
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Company (including an incorporated club, society, association or body of persons)
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The public officer (the signature of a director who is not the public officer is not sufficient)
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Unincorporated association or body of persons
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An office holder
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What to include in your letter
If you do not use one of the forms we provide you can write to us. Include copies of any documents that support your request as well as the following information:
- your tax file number (TFN)
- your full name
- your postal address
- a daytime phone number (if convenient)
- the year shown on the tax return you want to amend - for example, 2009
- the item number and description that your change relates to
- the amount of income or deductions to be added or taken away (if relevant)
- the amount of tax offsets to be increased or decreased (if relevant)
- the claim type code (if there is one for the item you are changing)
- the reason for the change or an explanation of how you made the mistake
- a signed and dated declaration as follows:
- all the information I have given in this letter, including any attachments, is true and correct
- I have the necessary receipts and/or other records to support my claims for amendment'
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Tax agents
Include your registered agent number on any amendment you submit.
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Name and contact information
Make sure you include the personal information (the first three dot points above), so we can identify your return. If we have to ask for this information, it will delay processing.
TFN
We are authorised by the Taxation Administration Act 1953 to collect your TFN. You are not required by law to provide your TFN; however, providing it reduces the risk of administrative errors that may delay the processing of your amendment.
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How to submit your request
Registered tax agents can submit amendment requests online through the:
- electronic lodgment service (ELS) (amendments to returns for all taxpayer types)
- mail function on the Tax Agent Portal (amendments to returns for all taxpayer types except individuals).
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Prior year returns
For 2010 and prior years, tax agents can use ELS only to lodge amendments to individual returns, not returns for other taxpayer types.
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If you are a business taxpayer you can use the Business Portal (if you are registered).
To submit a paper version, you or your representative should send your request, including all attachments, to us:
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For more information about amendment requests, contact us.
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How we process your amendment request
Amendments are part of the self-assessment system. That is, just as we accept your tax return information at face value, in most cases we also accept the information contained in your request for an amendment.
After we process your request we give you a new notice of assessment, which we call a notice of amended assessment. The amended assessment shows the new amount payable or refundable.
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If you submit a request for an amendment before we have processed your tax return, we process them together and you receive only a notice of assessment (not a notice of amended assessment).
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If we owe you money, we will pay you, including any interest you are entitled to. If you owe us money, the notice of amended assessment will tell you the amount (including any interest and penalty) and when it is due if you want to avoid being charged further interest for late payment.
The time it takes us to process your amendment depends on how you lodge it and whether it was as a result of a clerical or administrative error on our part. Our standard processing times listed in the table below are measured from the time we receive all the information we need to process your amendment.
Lodgment method
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Time to process
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Our mistake
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Your mistake
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Mail or fax
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14 days
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56 days
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Online (tax agents)
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14 days
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28 days
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If we:
- need more information, we ask you for it within 14 days of receiving your request
- cannot meet the normal processing time (for example, because of the complexity of the matter) we contact you or your representative within 14 days of receipt of your information and arrange a new completion date.
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If we refuse to process your amendment and you still want the changes made to your tax return, you can lodge an objection to the relevant assessment.
Information explaining how you do this is sent to you with the letter telling you of our decision.
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Correct an instalment or business activity statement
The way to correct a mistake made on an activity statement depends on what tax your mistake relates to.
You can use your current business activity statement (BAS) to correct many GST and fuel tax credit mistakes. If you can't make the correction on your current BAS, or the mistake relates to another type of tax, you either have to revise the original BAS or write to us (except for PAYG instalments). You can vary a PAYG instalment on your current instalment or business activity statement.
Unclaimed refunds and credits
A four-year time limit applies to claiming credits and refunds. The time starts from the end of the tax period the credit arose or, for excise on imported goods, the date of importation.
Revising an earlier activity statement
Registered users of the Business Portal, Tax Agent Portal, BAS Agent Portal, electronic lodgment service (ELS) and electronic commerce interface (ECI) can revise an earlier activity statement online.
Goods and services tax (GST)
You can correct GST mistakes on the activity statement that is current when you find the mistake, unless you are outside the correction limits. If so, you will need to revise the earlier activity statement.
Fuel tax credits
You can correct mistakes and adjust your fuel tax credits on your current activity statement, unless you are outside the correction limits. If so, you will need to revise the earlier activity statement.
Correction limits for GST and fuel tax credits
There are time and value limits that determine whether or not you can correct a mistake on your current activity statement. Your annual business turnover determines your value limit.
Luxury car and wine equalisation taxes
To correct a mistake relating to wine equalisation tax (WET) or luxury car tax (LCT), you need to lodge a revised activity statement. You can make an adjustment to LCT on your current activity statement.
Pay as you go (PAYG) withholding
To correct a mistake in the PAYG withholding amount reported on your activity statement, you revise the original activity statement. To report an amount not withheld when it should have been, write to us.
Pay as you go (PAYG) instalments
How you change the PAYG instalment amount you have reported on your activity statement depends on whether your income tax return for that year has been assessed.
Unclaimed refunds and credits
You do not have to claim a credit or refund in the BAS period it arises, regardless of whether it relates to GST, luxury car tax (LCT), wine equalisation tax (WET) or fuel tax credits.
Because not claiming a refund or credit is not a mistake, claiming it later is also not a correction. There is, however, a four-year time limit on claiming most refunds and credits. The four-year period starts from the end of the tax period the credit arose or, for excise on imported goods, the date of importation.
You can claim credits on the activity statement that is current when you find the entitlement, provided you are within the time limit. If it is a fuel tax credit, you must work out the amount using the rate that applies at the time you make the claim.
If you know you want to claim a WET credit, fuel tax credit or GST refund but are unable to do it within the four-year period, you need to let us know before the time limit expires. For GST, use the form, Notification of entitlement to GST refund (NAT 11719).
Excise
Some excise refund applications must be submitted within 14 days of the date on which the excise duty was paid. This time may be extended to 12 months in some circumstances. Claims for drawback of duty must be lodged within 12 months of the date of export.
Revising an earlier activity statement
If you need to revise information you provided on an activity statement and are not eligible to correct it on a later statement, you may need to complete a revised activity statement. You can do this online or on paper.
Increased tax or reduced credit
If your revision increases the tax you owe or reduces your credit, we generally treat your revised activity statement as a voluntary disclosure of unpaid tax or over-claimed credits. This means you are likely to receive concessional treatment for any penalties and interest charges that apply. (You will still have to pay any outstanding tax or overpaid credits and you may have to ask for concessional treatment for any interest charges.)
Online revision
Registered users of the following online services can complete a revised activity statement online:
- Business Portal at www.abr.gov.au
- Tax Agent Portal or BAS Agent Portal
- electronic lodgment service (ELS), or
- electronic commerce interface (ECI).
Using the portals
- Select the 'Processed' activity statement from the 'History' list.
- Select 'Request revision', and
- Enter the revised values.
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If the revision button does not display, you cannot revise the activity statement through the portal.
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Using ELS
- Use the document identification number (DIN) from the activity statement you need to amend.
- Enter a number between 1 and 9 in the 'Revision indicator' field.
- Transmit the new values of the labels to be revised.
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For more information, about online lodgment:
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Paper revision
Obtain a paper version of the revised activity statement by contacting us.
Mail your completed revised activity statement to us using the pre-addressed envelope provided. Do not send us a copy or a version generated from a commercial software package.
If you misplace the pre-addressed envelope, post your revised activity statement to the appropriate address.
If your business is located in NT, SA, TAS, VIC or WA, post to:
If your business is located in ACT, NSW or QLD, post to:
Goods and services tax (GST)
You may have made a mistake or left information out of a previous activity statement, found a processing error we have made or have a GST credit to claim.
Correcting your mistakes
You can correct mistakes on the activity statement that is current when you find the mistake, unless you are outside the correction limits. If you are outside the limits, you will need to revise the earlier activity statement.
If you are outside the value limit, you only need to revise sufficient original activity statements to bring the total value of your remaining mistakes below the limit. At that point, if you are within the time limit, you can make the remaining corrections on your current activity statement.
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GST groups
The time and value limits apply to the group as a whole and not to each entity in the group separately.
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Correcting our mistakes
We can make errors processing your BAS, for example, it may scan incorrectly or we may make a keying error. If you think we have made an error, contact us.
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Refer to:
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Unclaimed credits
You may have been entitled to claim credits on an earlier activity statement but for some reason you did not (for example, because you were not aware that you had a tax invoice).
You can claim these credits on the activity statement that is current when you find the entitlement, provided you are within the four-year time limit.
Fuel tax credits
You may have made a mistake on or left something out of a previous activity statement or used the fuel in a manner different to your original intention. Or you may have found a processing error we have made or have a fuel tax credit to claim.
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If you don't claim fuel tax credits through the business activity statement process, see Fuel scheme claims.
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Correcting your mistakes
You can correct mistakes and adjust your fuel tax credits on the activity statement that is current when you find the mistake or become aware of the need for an adjustment.
Some limits apply to correcting mistakes but there are no restrictions on adjustments. If you are outside the correction limits, you will need to revise the earlier activity statement.
If you are outside your value limit, you only need to revise sufficient original activity statements to bring the net value of your remaining mistakes below the limit. At that point, if you are within the time limit, you can make the remaining corrections on your current activity statement.
Mistakes
A mistake occurs when the amount you claimed on your activity statement was not correct at the time you sent it to us because you made an error; for example, you used the wrong rate for your calculation or double-counted some purchases.
Adjustments
The need for an adjustment arises when you claim fuel tax credits based on your intention to use fuel in a certain way, but you end up using some or all of it in a different way. This means the activity statement was correct at the time you sent it to us (because you intended to use the fuel that way) but the changed use means you must make an adjustment to keep your claim correct.
Correcting our mistakes
We can make errors processing your BAS, for example, it may scan incorrectly or we may make a keying error. If you think we have made an error, contact us.
Unclaimed credits
You may have been entitled to claim fuel tax credits on an earlier activity statement but for some reason you did not (for example, because you were not aware that you had a tax invoice).
You can claim these credits on the activity statement that is current when you find the entitlement, provided you are within the four-year time limit.
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When claiming a fuel tax credit for an earlier BAS period you must work out the amount using the rate that applies at the time you make the claim.
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Correction limits for GST and fuel tax credits
For goods and services tax (GST) and fuel tax credits you can use your current BAS to correct errors you made on earlier activity statements. Time limits and value limits (based on your business turnover) apply.
If you are outside your time or value limit, you have to revise the original activity statement.
The advantage of correcting a mistake on your current BAS is that if the correction increases your tax or reduces your credits, you avoid incurring interest dating back to the due date of the activity statement on which the mistake was made.
If you revise an earlier BAS and the revision increases the tax you owe or reduces your credits, we generally treat the revised BAS as a voluntary disclosure. This means you are likely to receive concessional treatment for any penalties and interest charges that apply (for example, lodging an incorrect return penalty or shortfall penalty). You will still have to pay the outstanding tax and may have to make a written request for interest concession.
GST groups
The time and value limits apply to the group as a whole and not to each entity in the group separately.
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Unclaimed credits
You do not have to claim a credit or refund, so not claiming one is not a mistake and claiming it on a later activity statement is not a correction. There is, however, a four-year time limit for claims.
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Time limits
The time limit that applies to you depends on your business turnover. Most people and organisations have up to 18 months to identify and correct an error that increases their GST or reduces their fuel tax credit, see the table below.
Don't delay making a correction. We view waiting until the last possible tax period within the time limit as taking unwarranted advantage of this process.
Annual turnover
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Time limit
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Less than $20m
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18 months, that is:
- 18 monthly activity statements, or
- 6 quarterly activity statements, or
- 1 annual GST return.
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$20m or more
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3 months (three activity statements).
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Annual GST return
If you make an error in your annual GST return, you will be able to correct it in your next annual GST return. Correcting mistakes in this way may inflate your instalment amount in the following year.
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Unclaimed credits time limit
You do not have to claim a credit or refund, so not claiming one is not a mistake and claiming it on a later activity statement is not a correction. There is, however, a four-year time limit for claims.
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Value limits
The value limit that applies to you depends on the turnover of your business. It is not determined on a 'per activity statement' or 'per mistake' basis. The total or net effect of all the goods and services tax (GST) or fuel tax credit errors you are correcting must be within the limit for the size of your business. The limits apply regardless of whether your entitlement is being increased or decreased as a result of correcting the mistake.
Annual turnover
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Correction value limit
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Less than $20m
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$4,999
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$20m to less than $100m
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$9,999
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$100m to less than $500m
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$24,999
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$500m to less than $1b
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$49,999
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$1b and over
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$299,999
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Reducing net value to the limit
You only need to revise sufficient original activity statements to bring the net value of your remaining mistakes below the limit. At that point, if you are within the time limit, you can make the remaining corrections on your current activity statement.
Luxury car and wine equalisation taxes
To correct a BAS mistake relating to luxury car tax (LCT) or wine equalisation tax (WET) you need to lodge a revised activity statement.
You can make an adjustment to LCT on your current activity statement.
Mistakes
A mistake occurs if the amount you reported on your activity statement was not correct at the time you lodged your activity statement.
Adjustments
The need for an adjustment does not arise with WET. With LCT it arises when the tax amount was correct at the time you reported it but has increased or decreased since.
An increasing adjustment can arise if any of the following occur:
- there has been an increase in the price of the car
- you quoted your ABN when you purchased or imported the car but used it for a non-quotable purpose
- you've recovered a bad debt in relation to a luxury car
- you previously had a 'decreasing adjustment' and now use the luxury car for a non-quotable purpose.
A decreasing adjustment can arise if any of the following occur:
- there is a decrease in the price of the car
- you have written off a bad debt in relation to a luxury car or a debt has been overdue for 12 months or more
- you did not quote your ABN at the time of the purchase or import and either of the following applies
- you intend to use the vehicle for a quotable purpose
- you have used the vehicle for a quotable purpose only
- the sale is cancelled.
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For information on making an LCT adjustment on your current BAS, refer to Completing the LCT labels in the Guide to activity statements.
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Pay as you go (PAYG) withholding
To correct a mistake in the PAYG withholding amounts you reported on your BAS, whether over-stated or under-stated, you need to lodge a revised activity statement for the period in which the error was made.
If the error was that you did not withhold an amount that you should have from a payment, you need to write to us.
Whatever the mistake, you may also need to correct one or more payment summaries.
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Don't include any amount that you failed to withhold on either an original or a revised activity statement.
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If you revise an earlier BAS and the revision increases the tax you owe, or you advise us by letter that you have not withheld an amount from a payment, we generally treat the revised BAS or letter as a voluntary disclosure. This means you are likely to receive concessional treatment for any penalties and interest charges that apply. You will still have to pay the outstanding tax and may have to make a written request for interest concession.
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If you do not withhold the required amount from a payment you make, you are liable to a penalty equal to the amount you should have withheld. If you make repeated voluntary disclosures about amounts you did not withhold, we will not remit the penalty.
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What to include in your letter
When you write to advise us of an amount you did not withhold from a payment, include the following information in your letter:
- your name or your business's name - that is, the full name of the taxpayer that should have withheld the amount
- your phone number and address or the name, phone number and address of your authorised contact or tax agent
- the name of the person or organisation you made the payment to
- the date you made the payment
- what the payment amount was
- what the amount you should have withheld was, or an estimate of what it should have been
- a signed and dated declaration as follows:
I declare the information I have given in this letter, including attachments, is true and correct and that I am authorised to disclose this information.
your signature
the date
Keep a copy of the letter for your records.
Post your letter to us at:
PAYG withholding payment summary corrections
If you have made a mistake on your activity statement, you may also need to correct a mistake made on one or more payment summaries. Changing a payment summary may mean you also need to revise your payment summary statement or payment summary annual report, or both. See PAYG withholding payment summaries.
Pay as you go (PAYG) instalments
You may want to change your PAYG instalments because the instalment calculated by the Commissioner on your activity statement no longer reflects your likely end-of-year tax situation. You can do this on your current activity statement.
You need to use the new amount or rate for any remaining instalments for the income year, unless you vary it again.
When you vary your instalment, you need to include a reason code at label T4 on the activity statement. Use the code that best describes why you are varying the instalment.
If you realise after you lodge your activity statement that you made a mistake working out the variation, you may be able to correct it either by lodging a revised activity statement or varying a subsequent instalment amount.
You can lodge a revised activity statement if:
- you can lodge it by the date the original activity statement was due, and
- you have not lodged your tax return for the relevant year.
You can vary a subsequent instalment if it is within the same income year as the incorrect one.
If you don't meet the conditions for lodging a revised activity statement or varying a subsequent instalment, your tax position will be automatically rectified through your tax assessment for the year.
If the varied instalment amount or rate turns out to be less than 85% of what it should have been, you may be liable to pay a variation penalty. In most cases, we don't impose a penalty if the variation was reasonable in your circumstances.
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PAYG instalment revisions change the credit allowed in your income tax assessment, which is why we only accept revisions of instalment income before the relevant income tax return has been processed.
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Correct excise and FBT returns, non-BAS fuel scheme claims and PAYGW payment summaries
What you need to do to correct claims for fuel schemes grants and credits (including fuel tax credits you don't claim through the business activity statement process); fix mistakes on excise and fringe benefits tax returns; and correct PAYG withholding payment summaries.
Excise returns
How you correct an error on your excise return depends on whether you want to change the product or other details.
Fringe benefits tax (FBT) returns
To correct an error on your FBT return, you request an amendment to your assessment.
Fuel scheme claims
Advise us in writing as soon as possible if you need to change information you have provided in claims under the Product stewardship for oil program, Cleaner fuels grants scheme, Energy grants credits scheme (alternative fuels) or Fuel tax credit scheme (if you don't claim fuel tax credits through the BAS process).
PAYG withholding payment summaries
How you correct a payment summary depends on whether the mistake is in the dollar amounts or other information.
Excise returns
There are two forms available to correct information reported on your excise return. Which one you use depends on what you want to change. If it is:
- information in the 'Product details' section of the return, use the Amending excise return form.
- other information in the return, for example, client details or settlement period, submit a new Excise return form.
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To obtain a paper copy of either return form, download a PDF:
For:
- instructions on completing the forms, refer to
- further help completing the Amending excise return contact us
- alcohol-related matters - 1300 137 290
- fuel-related matters - 1300 137 292
- tobacco-related matters -1300 137 295.
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How to submit your return
Send your return to us by:
Fringe benefits tax (FBT) returns
If you realise you have made a mistake on your FBT return, you need to request an amended assessment, in writing, as soon as possible. Alternatively, your registered tax agent can submit your request online through the electronic lodgment service (ELS).
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Prior year returns
ELS is not available for FBT amendment requests for 2010 and prior years.
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Penalty for lodging an incorrect return
There is a penalty for lodging an incorrect return, so it is important to tell us about any mistakes as soon as possible to avoid having to pay a penalty.
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You need to know:
- who can sign your request
- what information to include, and
- how to submit your request.
There is no fee for requesting an amendment and you don't have to send another tax return unless we ask you to.
Who can sign an amendment request
The acceptable signature on a request for an amendment varies depending on the business structure of the taxpayer making the request (see Who can sign an amendment request).
What to include in your letter
Include the following information in your request for an amendment:
- name and tax file number (TFN) of employer
- name, postal address and contact number of person we can contact about this request
- FBT year the mistake relates to
- reason for the amendment and sufficient information about the changes to the taxable values of the affected benefits
- exact adjustment to each benefit category, including the corrected taxable values
- whether the benefits are type 1 or type 2
- amended fringe benefits taxable amount
- a signed and dated declaration as follows:
I declare that all the information I have given in this letter, including any attachments, is true and correct.
your signature
the date
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TFN
We are authorised by the Taxation Administration Act 1953 to collect your TFN. You are not required by law to provide your TFN; however, providing it reduces the risk of administration errors that could delay the processing of your return.
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How to submit your request
Post your request for an amendment to:
Registered tax agents can submit amendment requests online through the electronic lodgment service (ELS).
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Prior year returns
ELS is not available for FBT amendment requests for 2010 and prior years.
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To correct the amount of 'reportable fringe benefits' shown in an individual tax return, you need to request an amendment to your income tax return.
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Fuel scheme claims
You need to request an amendment in writing - either by letter or using a form we supply - to change information you have provided in a claim under the:
- Product stewardship for oil program (PSO)
- Cleaner fuels grants scheme (CFGS)
- Energy grants credits scheme (alternative fuels).
You also need to request an amendment in writing if you:
- generate electricity for domestic use or operate non-profit emergency vehicles or vessels, and
- don't claim your fuel tax credits through the business activity statement (BAS) process.
(See Fuel tax credits or information on how to correct mistakes made on business activity statements in relation to the fuel tax credits scheme.)
Cleaner fuels grants scheme
You can use the Cleaner fuels grants scheme request to amend a claim instead of writing us a letter.
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To obtain a copy of the Cleaner fuels grants scheme request to amend a claim (NAT 9841), phone us on 1300 137 294.
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Returned or exported fuel
If you have received a cleaner fuels grant on fuel that is exported or returned to you, you will need to repay the grant.
You do this by claiming a refund of the duty you paid on the fuel. We will issue an amended assessment for the claim period in which the grant was originally made that will show the resulting debt. As the amended assessment results in a debt, you may incur a general interest charge.
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For more information regarding:
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Energy grants credits scheme (EGCS)
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The fuel grant rate for alternative fuels reduced to zero on 1 July 2010. You cannot claim a grant for fuels purchased on or after that date.
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Although energy grants credits are no longer available, you may still need to change a claim relating to fuel purchased before 1 July 2010 if you claimed on the basis of intended use and:
- your actual use in the financial year was lower than you estimated by more than 5,000 litres or 15%
- the fuel was lost, stolen or otherwise disposed of, even if the amount involved is below the 5,000 litres/15% threshold.
There may also be other reasons for amending your claim, such as making a mistake on your claim form.
Form or letter
Until 30 June 2011, you can use the EGCS claim form to request an amended assessment due to a difference between intended and actual fuel use provided you are within two years of the end of the original claim period.
If you can't use the EGCS claim form, you can use your business activity statement (BAS) to make the claim until 30 June 2013.
To request an amendment if you can't use the EGCS claim form or your BAS, write to us including all the information and explaining your circumstances and the reasons for the delay. See What to include in your letter.
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For more information or to obtain advice if you think you have made an error, phone us on 13 28 66.
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Fuel tax credits
You may have made a mistake on or left something out of a previous claim or used the fuel in a manner that was different to your original intention and need to make an adjustment. You may also have found a processing error we have made or have a fuel tax credit to claim.
You can use your current claim form to:
- make adjustments that decrease your fuel tax credits
- correct some mistakes made on an earlier claim.
For changes that increase your entitlement to fuel tax credits you need to write to us.
Adjustments
The need for an adjustment occurs when you have already claimed fuel tax credits based on your intention to use the fuel in a certain way, but you end up using some or all of it in a different way. This means your claim was correct at the time you sent it to us (because you intended to use the fuel that way) but the changed use means you must make an adjustment to keep your claim correct.
Make the adjustment in the period you use the fuel.
If the adjustment decreases your fuel tax credits entitlement (and most adjustments do):
- end your claim period within 90 days of becoming aware of the adjustment, and
- lodge the claim form with us within 21 days of the end of the claim period.
Make your adjustment in litres. On your claim form you need to decrease the amount of eligible litres you claim for that fuel type and activity.
If your adjustment increases your eligible litres, write to us and provide:
- your name and contact details
- your excise identification number (EIN), tax file number (TFN) or Australian business number (ABN)
- the start and end date for the return period
- the amount of eligible litres for each fuel type and activity before the adjustment
- the amount of the adjustment in litres for each fuel type and activity for the period.
Mistakes
A mistake occurs when the amount you claimed was not correct at the time you sent it to us because you made an error, for example, you used the wrong rate for your calculation or double-counted some purchases.
Mistakes can result in you claiming too much or too little in fuel tax credits.
You can change your eligible litres on your current claim form to account for a mistake if:
- the net effect of your mistakes is less than $5,000
- due to the mistake, your fuel tax credits for the return period are zero or more.
To work out if you are within the $5,000 limit, multiply the number of eligible litres by the relevant fuel tax credit rate.
You need to write to us if the net effect of your mistakes:
- means you have fuel tax credits of $5,000 or more
- decreases your entitlement to less than $5,000 but is too large to offset against your claim.
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Unclaimed credits
You do not have to claim a credit or refund, so not claiming one is not a mistake and claiming one on a later claim form is not a correction. However, there is a four-year time limit for claiming credits. The four years starts from the day you acquired the fuel.
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What to include in your letter
The information you need to provide depends on whether you are writing in relation to the fuel tax credits scheme or the other schemes.
Fuel tax credits amendment requests
Your letter should contain:
- your name and contact details
- Australian business number (ABN), tax file number (TFN) or excise identification number (EIN)
- the start and end date for the return period in which the mistake occurred
- fuel type and activity the mistake refers to
- the amount of the mistake in eligible litres
- the reason for the mistake
- your signature or the signature of a person authorised to act on your behalf.
PSO, CFGS and EGCS amendment requests
If you are not using a form, your letter requesting an amendment should contain:
- your client account number (shown on your claim form and claim assessment)
- your ABN
- the claim reference number (shown on your claim assessment)
- the reason for the amendment
- details of the amendment required
- the fuel type (EGCS only)
- the signature of a person authorised to act on behalf of the business.
If you are amending a paper claim, include the 'from' and 'to' dates you wrote on that claim. This helps us to identify the claim that is to be amended.
How to submit your amendment request
Post your request for amendment, including any attachments, to:
PAYG withholding payment summaries
You cannot simply change the information on a pay as you go withholding payment summary after you have given it to the payee or provided your PAYG withholding payment summary annual report to us.
How you correct a mistake depends on whether it was a dollar amount or payee or payer information.
Change to a dollar amount
If you find a mistake in a dollar amount after giving the payment summary to the payee or us, prepare a new payment summary:
- show the payee and payer information as it was on the original payment summary
- enter the new dollar amount or amounts
- mark the amending a payment summary box as shown:
- submit the completed payment summary online - or send it to us (use one of the addresses below) - within 21 days of issuing the amended payment summary
- give a copy to the payee.
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If you need extra paper payment summaries you can order them by phoning our automated ordering service on 13 72 26 at any time.
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Lodging amended payment summaries electronically
If you are set up to lodge your payment summary annual report electronically, you can lodge your amended payment summary electronically too. If your software can't produce an amended file, you will need to use our printed form.
Posting amended payment summaries
Post to:
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Lost payment summary
If your payee loses their payment summary, do not issue a new one. Give them a signed photocopy of your own copy showing all the details from the lost payment summary.
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Change to the payee or payer details
If the payee or payer information is incorrect you do not need to prepare a new payment summary or advise us of the changed details. Simply:
- advise your payee as soon as possible
- record the correct details and keep them in your files.
Change a payment summary annual report
If you have changed one or more dollar amounts on one or more payment summaries, you may also need to complete an amended PAYG withholding payment summary statement (NAT 3447).
Lodging amended annual reports online
If you are set up to lodge online, you can lodge your amended payment summary annual report online, too.
Make a voluntary disclosure
When a taxpayer tells us about a false or misleading statement they have made to us or a change that increases their tax or reduces their credits - and they do so without prompting, persuasion or compulsion on our part - we generally refer to it as a 'voluntary disclosure'.
A voluntary disclosure provides you with the opportunity to bring your tax affairs into order. For example, if you have not disclosed income that you know you should have, you have claimed deductions you know you weren't entitled to, or you have made other statements in relation to your affairs that you know were false or misleading. In most cases a voluntary disclosure also opens the way to concessional treatment both for any administrative penalties that apply and any interest charges. (Administrative penalties are those we may impose without taking court action.)
The amount of any reduction in penalty amounts and interest charges depends on when you tell us about the correction. Generally, the reduction is greater if you make the disclosure before we notify you of an examination. You will have to pay any tax you owe and may have to ask us for any interest concessions.
How to make a voluntary disclosure
To make a voluntary disclosure you can either use one of the forms we provide or write us a letter. If you write a letter, you need to provide all the information we need, including a declaration, correctly signed.
How we process your voluntary disclosure
We process your voluntary disclosure in the same way as we process the tax return or statement it relates to. This means that voluntary disclosures for income tax are treated as amendments.
GST, WET and fuel tax credit disclosures
Businesses may make a voluntary disclosure to report incorrect amounts of GST, wine equalisation tax (WET) or fuel tax credits or over-claimed fuel schemes credits. Property owners may have to make a 'creditable purpose' GST adjustment for property transactions not previously reported.
Penalties and interest arising from voluntary corrections
When you make a voluntary disclosure that increases the tax you should have paid (or reduces your credit), we generally substantially reduce any interest and administrative penalties we would otherwise impose. (Administrative penalties are those we may impose without taking court action.)
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Excise
Excise law has few administrative penalties and no provision for interest charges. It does not allow for concessional treatment of administrative penalties that arise as a result of a voluntary disclosure.
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Difficulty repaying a voluntarily disclosed debt
If you have difficulties meeting your payment obligations contact us and we will work with you to come up with a payment plan that takes your personal circumstances into account.
How to make a voluntary disclosure
You can make a voluntary disclosure:
- online (available to businesses and tax agents registered to use the portals)
- on paper, using a form we provide for the purpose
- by writing us a letter
- by phone (in limited circumstances).
Who can make a voluntary disclosure
You can make a voluntary disclosure yourself or you can ask another person (such as a friend, family member, legal personal representative or a tax agent) to make one on your behalf. The public officer of a company can make a voluntary disclosure on behalf of the company.
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Before someone who is not a tax professional can act for you, you must advise us so we can list them on your account as an authorised contact.
To do this:
You can withdraw this authorisation at any time.
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Forms
We provide specific forms for making voluntary disclosures in relation to income tax, excise and some GST activities:
Revised business activity statements
We treat revised business activity statements that increase your GST or reduce your fuel tax and other credits as voluntary disclosures.
What to include in a voluntary disclosure
If you do not use one of the forms or there is not one available for your situation, you can write us a letter.
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SMSF annual returns
You cannot write us a letter to make a voluntary disclosure about mistakes in the annual return of a self-managed super fund. You need to amend the return using the Completing the self managed super fund annual return form (NAT 71226). Let us know it is an amendment by checking 'Yes' at question 5.
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In your letter, include copies of any documents that support your request as well as the following information:
- your name
- your phone number and address (or the name, phone number and address of your tax agent or authorised contact)
- your tax file number (TFN) or Australian business number (ABN)
- the type of tax-related liability, payment or credit involved
- the relevant accounting period or periods
- the original document item or label numbers and the descriptions affected by the change, if applicable
- the claim type code, if applicable
- a description of the amounts to be increased or decreased
- the amount of each adjustment required, or sufficient information to allow us to readily determine the amount of each adjustment
- any other relevant information which will help us determine the correct amount of tax-related liability, payment or credit
- a signed and dated declaration.
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Name and contact information
Including the personal information (the first three dot points above), helps us identify your return. If we have to ask for this information, it will delay processing.
TFN and ABN
We are authorised by the Taxation Administration Act 1953 to collect your TFN. You are not required by law to provide your TFN or ABN; however, providing them reduces the risk of administrative errors that may delay the processing of your voluntary disclosure.
Tax and BAS agents
Include your registration number in any voluntary disclosure you submit.
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Declaration
Include the following signed and dated declaration on your voluntary disclosure:
- the information I have given in this document (including any attachments) is true and correct
- I am authorised to disclose this information.
If an authorised contact is sending a letter on your behalf, they must include the following signed and dated declaration:
- this voluntary disclosure has been prepared in accordance with the information supplied by the taxpayer
- I have received a written declaration signed by the taxpayer that the information they have provided is true and correct, and
- I am authorised by the taxpayer to make this voluntary disclosure to the Commissioner of Taxation.
Your contact must also state the capacity in which they are making the voluntary disclosure, for example, legal personal representative, tax agent, public officer for a company.
Where to submit a voluntary disclosure
Where you submit a voluntary disclosure depends on:
- whether the disclosure concerns offshore income
- the type of tax involved
- whether you are the taxpayer (or their legal personal representative) or a tax professional acting on behalf of a taxpayer
- whether we have notified you that we are going to conduct a review or examination.
Type of tax
If you are submitting a voluntary disclosure and have not been notified of a review or examination, use the appropriate address from the list in the table below.
If you are making a disclosure after you have been notified of a review or examination:
- for GST, wine equalisation tax (WET) and fuel schemes, including fuel tax credits - submit it by post or fax (see the table for the address), or hand it to your client relationship manager (if applicable)
- for other taxes and superannuation - by phone (conditions apply) or deliver to the tax officer conducting the review or examination.
Disclosures by phone
You can make a voluntary disclosure by phone if we have notified you of a review or examination of your financial affairs. In these circumstances, you (or your authorised contact) may make a voluntary disclosure to the tax officer who is conducting the review or examination.
When you phone, you may need to establish your identity by providing details of three of the following items:
- your TFN
- your date of birth
- your address (business, residential, postal or email)
- your bank account number (BSB number not required)
- details from a letter or notice we have issued to you within the past five years, such as
- the sequence number from a notice of assessment
- your e-tax reference number
- the document identification number (DIN) from an activity statement
- the reference number on correspondence.
Addresses for voluntary disclosures
Tax type
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Address
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Offshore income of any tax type
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Post to:
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Income tax - except for self-managed super funds (SMSFs)
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- Lodge online (registered users only) through
- Business Portal
(if you're a Business Portal user)
- Tax Agent Portal
(for partnership, trust, company and super fund returns - use the mail function)
- electronic lodgment service (ELS)
(for returns for individuals)
- Post to
Australian Taxation Office
PO Box 3004
PENRITH NSW 2740
Tax agents only
Australian Taxation Office
GPO Box 5056
SYDNEY NSW 2001
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Revised BAS (business activity statement):
GST, WET, fuel tax credits, pay as you go (PAYG) withholding
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Lodge your revised activity statement the same way you lodge your regular activity statement.
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GST (property transactions)
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FBT
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Post to:
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LCT
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Pay as you go (PAYG) withholding
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Post to:
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Excise returns
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Excise: fuel schemes
- Product stewardship for oil
- Energy grants credits scheme
- Cleaner fuels grants scheme
- Fuel tax credits (non-BAS claimants)
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Post to:
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How we process your voluntary disclosure
We process your voluntary disclosure in the same way as we process the tax return or statement it relates to. If we need more information, we will contact you or your representative.
Once we have processed your information, we will issue an assessment or other notice that tells you how much tax or overpaid credits and benefits you owe, any penalties and interest charges we have imposed and the date your payment is due (to avoid being charged further interest for late payment, if this is applicable).
Request reduced interest charges or penalties
You can ask us to reduce any interest charges and penalties that arise from your voluntary disclosure.
Disagree with an assessment
If you disagree with an assessment or amended assessment for income tax, fringe benefits tax (FBT), luxury car tax or wine equalisation tax (WET) you can object to it.
You can also object to:
- claim assessments under the Cleaner fuels grants scheme, Product stewardship for oil program and the Energy grants credits scheme
- demands made by excise collectors under section 60, 77AA or 77FH of the Excise Act 1901.
GST, WET and fuel tax credit disclosures
If you lodge business activity statements you can make a voluntary disclosure by lodging a revised activity statement. We have a specific form you can use to tell us about any mistakes relating to property that you have made on your activity statement. For example, not making an adjustment when it was due.
If you claim your fuel tax credits using a claim form, see Non-BAS claimants.
BAS lodgers
If the correction limits prevent you from using your current activity statement to correct mistakes you have made on an earlier activity statement, you need to revise that earlier activity statement.
If the revision increases your GST or reduces your fuel tax credits, we treat that revised activity statement as a voluntary disclosure. This is likely to mean that you will receive the penalties and interest concessions available.
You can also make a voluntary disclosure if you have made a false or misleading statement on a previous activity statement.
If we have informed you that we are going to conduct a review or examination in relation to a particular accounting period, you cannot correct any errors for that accounting period by using your current activity statement or lodging a revised activity statement. You may make a voluntary disclosure of any errors directly to the tax officer conducting the review or examination.
Property transactions
If you are a property owner, developer or are registered for GST and you use your property in a way that is different from the way you planned to, you may have to report a GST adjustment. You can also make a 'creditable purpose' adjustment for property transactions that you did not report, rather than revise the activity statement that covers the period the change occurred.
Use the form (NAT 72625) provided in Reporting mistakes on GST and property transactions to tell us about any property-related mistakes you have made on your activity statement, for example, if you did not make an adjustment when it was due. (You cannot use this form to amend your information if we have told you we are going to conduct an examination.)
The benefit of making this disclosure is that you will not have to pay any shortfall penalties that would otherwise be applicable and any general interest charge (GIC) will be reduced.
Send your completed form to the address or fax number shown on the form.
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To discuss a mistake, contact us.
For more information, refer to:
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Non-BAS claimants
People who use a claim form to claim their fuel tax credits (that is, people who generate domestic electricity and non-profit organisations operating emergency vehicles or vessels) may make a voluntary disclosure by asking for an amendment to their claim.
Penalties and interest arising from voluntary corrections
When a taxpayer tells us about a false or misleading statement they have made to us or a mistake that increases their tax or reduces their credits - and they do so without prompting, persuasion or compulsion on our part - we refer to it as a 'voluntary disclosure'.
A voluntary disclosure generally opens the way to concessional treatment both for any administrative penalties that apply and any interest charges. (Administrative penalties are those we may impose without taking court action. They apply uniformly across most tax laws. That is, the penalty imposed for a particular type of mistake is the same regardless of the law involved, except for excise. Excise law has its own penalties regime.)
You will have to pay any tax you owe and may have to ask us for any interest concessions.
Reduced interest charges
A correction that increases your tax (or reduces your credits) creates a tax shortfall. We may impose an interest charge on the shortfall. For shortfalls that are the result of a voluntary disclosure, we may reduce the interest charge in the course of processing your voluntary disclosure (unless the law prevents us from doing so).
The amount of any reduction depends on when you tell us about the correction. Generally, the reduction is greater if you make the disclosure before we notify you of an examination.
You may also be entitled to ask us to reduce the interest charge.
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Tax shortfall
A tax shortfall is the difference between the amount of tax you were originally assessed for (or refunds you claimed) and the amount of tax you were eventually assessed for (or credits you were entitled to).
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For more information, refer to:
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Reduced penalties
The amount of any reduction in penalty amounts depends on when you tell us about the correction. Generally, the reduction is greater if you make the disclosure before we notify you of an examination. For example, if we find mistakes or omissions as part of an examination, the penalty can be as high as 90% of the tax shortfall we uncover. However, if you disclose the tax shortfall voluntarily, we may reduce the penalty by 80% or more.
We will reduce some penalties by 80% if you tell us about a shortfall amount before the earlier of:
- the day we tell you we are going to conduct an examination of your affairs, or
- the last day we will accept a voluntary disclosure if we have publicly requested voluntary disclosures about a transaction that applies to your financial affairs.
If the shortfall is less than $1,000, we will reduce the penalty to nil if you tell us before we tell you we are going to examine your tax affairs and we have not publicly requested voluntary disclosures.
If you make the voluntary disclosure after we advise you we will conduct a tax examination, we will reduce the penalty by 20% if your disclosure can reasonably be estimated to have saved us a significant amount of time or resources.
In limited circumstances, we apply the 80% reduction to taxpayers who qualify only for the 20% reduction.
Conversely, we may increase the penalty if we consider your particular circumstances warrant it.
You can ask us to reduce the amount of some penalties and if we decline your request, you can object to that decision.
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For more information, refer to:
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Difficulty repaying a voluntarily disclosed debt
If you have difficulties meeting your payment obligations contact us and we will work with you to come up with a payment plan that takes into account your personal circumstances.
You may request a further reduction of any penalties or interest charged or additional time to pay based on your personal circumstances. You will need to provide the full details in writing.
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For more information:
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How to correct a mistake - summary
There are many reasons you may need to correct the information you reported to us.
We recommend you correct any error as quickly as possible. In some cases, there are legal time limits that mean we cannot make adjustments. There are also penalties that may apply.
You should keep records of any corrections you ask us to make.
The checklist below shows what process you use to request a change to tax returns (including excise), business activity statements, claims for grants and benefits, and other reports and statements.
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Unclaimed refunds and credits
Unclaimed refunds and credits - whether for GST, luxury car tax (LCT), wine equalisation tax (WET) or fuel tax - are not considered mistakes and therefore claiming them later is not considered a correction.
There is, however, a four-year time limit for claiming most credits. An exception is excise credits, which are controlled by excise regulations and various time limits apply.
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Reasons for corrections
You may need to correct the information you have provided to us because you:
- made an entry error, such as writing a figure incorrectly
- left out some income (for example, you got another payment summary after you lodged your return)
- left out some of your GST taxable supplies
- didn't report a capital gain
- have had to repay income you were taxed on in an earlier year
- didn't claim a deduction
- didn't claim a credit
- claimed a credit incorrectly (for example, if you worked out a fuel tax credit using the wrong formula or overstated your GST credits)
- recorded an incorrect settlement period, tariff item, quantity or excise amount on your excise return
- deliberately or inadvertently claimed expenses that were not allowable deductions
- concealed some income or a capital gain
- made a claim in anticipation of a particular set of circumstances, but the circumstances changed after you lodged (for example, you claimed a deduction for something you bought for your business but ended up using privately or you claimed a credit for fuel you later used for a purpose that didn't qualify for a fuel tax credit)
- received updated information from your employer (for example, changed information about your reportable employer super contributions).
Time limits
Broadly, the time limit for changing most tax information apart from income tax returns is four years from the due date for payment of the original statement or assessment. For income tax returns it is two years for most individual taxpayers and four years for all other taxpayers.
Record keeping
Make a copy of everything you send to us when you ask us to correct a mistake or review a decision, including when you use the formal objection process to dispute a decision.
Keep these records and all other information relevant to your correction for five years. If you are in dispute with us and the dispute is not finalised by the end of five years, keep the records until it is finalised.
If you correct a mistake on your activity statement, keep a note to record the tax period the mistake was made in and the activity statement it was corrected on.
Checklist: Correction methods
Dispute (object to) an ATO decision
The law gives you the right to object to some decisions we make about your tax affairs, including most tax assessments. You can also object to some other decisions in relation to income tax, and many decisions about goods and services tax, fringe benefits tax, luxury car tax, wine equalisation tax, excise, superannuation and the Australian business number. If you object to a decision, we conduct an internal review.
Independent internal review
We recognise and value the importance of independent internal review. There are situations where lodging an objection is the appropriate course of action. There are also other steps you could consider before formally lodging an objection.
Decisions you cannot dispute using the objection process
There are some decisions we make that the law does not allow you to object to. (In some cases there are other ways of disputing these decisions.)
Decisions you can object to, and time limits
There are time limits that govern how long you have to object to a decision we have made. They vary, depending on the type of decision you are objecting to.
Extension of time to object
To lodge an objection outside the time limit, you must ask for an extension of time. You do this by including a written request for an extension of time with your objection.
How to object to a decision
To object to a decision we have made, you can either use one of the forms we provide or write to us. Make sure you include all the information we need and a declaration, correctly signed. You can authorise someone to lodge an objection on your behalf.
How we process your objection
We review the facts and evidence you provide. From the day we receive all the necessary information, it takes up to eight weeks to make a decision on your objection. If you disagree with that decision, you can apply for an independent external review.
Independent internal review
We recognise and value the importance of independent internal review. Your objection will be considered by a person who was not involved in the original decision. Areas and roles that undertake reviews are separate from and independent of those that make the initial decisions. The review will be conducted in an impartial manner, free of influence or bias.
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Objections and amendments
You request an amendment to correct a mistake or omission on your tax return; you lodge an objection if you want to dispute the facts or the law.
You can also use the objection process if you are outside the time limits for amending your tax return.
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Contact us first
Even if you have the right to object, it is usually faster and easier to correct the situation in other ways. If you think there has been a mistake, simply ask us to correct it. There is a contact phone number on the letter or notice you have received. If we disagree that it is a mistake, you still have the right to object to our decision.
When to consider using the objection process
You should consider lodging an objection to a decision we have made about your tax affairs if:
- you disagree with the way we have interpreted the law, for example, you disagree with an amended assessment we have given you
- you are uncertain about your interpretation of the law (for example, you're not sure whether you should have included some income on your tax return or claimed some expenses)
- you want the option of seeking an external review if we don't agree with you.
If you decide to lodge an objection, include all the information we need and lodge it within the time limit.
You can authorise someone to lodge an objection on your behalf.
Penalties, interest and tax debt
As a general principle, we expect you to pay all tax debts on time, even if you are disputing the debt. If you don't pay the tax debt by the due date it will attract general interest charge (GIC) for late payment (except excise debts, which are not subject to interest charges).
Decisions you cannot dispute using the objection process
There are some decisions we make that the tax laws do not allow you to object to (although in some cases there are other ways of disputing these decisions).
You cannot use the objection process to disagree with:
- a general interest charge
- a decision not to remit (reduce or cancel) a general interest charge
- a shortfall interest charge
- a decision not to remit (reduce or cancel) a shortfall interest charge - unless the amount of interest to be paid after the decision has been made is more than 20% of the shortfall amount (see example, below)
- a late payment penalty
- a decision not to remit (reduce or cancel) some penalties - unless what you owe after the decision has been made is $340 or more
- a private ruling if an assessment has issued covering the period - you may object to the assessment instead
- an excise private ruling where there is another 'reviewable decision' about the excise duty (or other amount payable) in relation to the same goods - you may object against the other decision
- administratively binding advice or advice about proposed changes to tax laws
- a co-contribution determination (you have to request a review).
Example - shortfall interest charge
You can object to our decision not to remit a shortfall interest charge if the interest you are left to pay is more than 20% of the shortfall amount. If your tax shortfall is $2,000, 20% is $400. If, after we have made a decision on remission, the shortfall interest charge (SIC) is $401 or more, you could object to that decision. Conversely, if it were $400 or less you could not object to it.
Contact us
Even if the law does not allow you to formally object to our decision, you can still talk to us about it. It may be that there is a misunderstanding. If you ask, in most cases we will review the decision consistent with good administrative practice.
You may also be able to get the decision reviewed by a tribunal or court.
Decisions you can object to, and time limits
The law gives you the right to object to tax assessments and some other decisions we make if you are not satisfied with them. You can also object to some administrative penalties we apply but not to court-imposed penalties.
Time limits for lodging objections vary from 60 days to four years. The time starts from the date the assessment or notice of decision was given to you.
If the final lodgment day falls on a non-business day, your objection can be lodged on the next business day.
You can object to some decisions concerning:
Australian business number (ABN)
Excise
You can object to
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How long you have
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Licence refusals, suspensions and cancellations
Refusals to allow claims for remission, rebate, refund or drawback of excise duties
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60 days from the date the decision was given to you.
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Disputed liabilities (amount of duty, rate of duty or liability of goods to duty)
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6 months from the date you deposited the duty.
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Demands for payment of duty equivalent
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60 days from the date the demand was given to you.
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Private rulings
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60 days from the date the ruling was given to you.
You cannot object to a private ruling if you have another reviewable decision about the excise duty in relation to the same goods - object to the other decision instead.
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Fringe benefits tax (FBT)
You can object to
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How long you have
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Assessments
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4 years from the date the assessment was given to you.
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Amended assessments
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Until the later of:
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Private rulings
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Until the later of:
You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Fuel schemes (excluding fuel tax credits)
Benefits under the Product stewardship for oil program and the Energy grants (cleaner fuels) scheme
Fuel tax credits
You can object to
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How long you have
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Assessments
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4 years and 1 day from the date the assessment was given to you.
For assessments relating to tax periods that started before 1 July 2012 you have until the later of:
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Amended assessments
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Until the later of:
For amended assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the amended assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Private rulings
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60 days from the date the ruling was given to you.
You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Reviewable fuel tax decisions
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60 days from the date the decision was given to you.
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Failures to make an assessment
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60 days from the date you gave notice requesting an assessment.
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Decisions to retain refunds
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Your objection period starts 75 days (plus any time you take to provide additional information we ask for) after you lodge your activity statement. It ends when you receive an amended assessment (or equivalent for refunds relating to tax periods that started before 1 July 2012).
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Goods and services tax (GST)
You can object to
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How long you have
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Assessments
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4 years and 1 day from the date the assessment was given to you.
For assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Amended assessments
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Until the later of:
For amended assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the amended assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Private rulings
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- Until the time you lodge a BAS that takes into account the matter to which the ruling relates.
- For private rulings relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the ruling was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
- You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Reviewable GST decisions
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Failures to make an assessment
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60 days from the date you gave notice requesting an assessment.
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Decisions to retain refunds
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Your objection period starts 75 days (plus any time you take to provide additional information we ask for) after you lodge your activity statement. It ends when you receive an amended assessment (or equivalent for refunds relating to tax periods that started before 1 July 2012).
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Income tax
You can object to
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How long you have
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Assessments
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2 or 4 years from the date the assessment was given to you
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Amended assessments
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Until the later of:
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Private rulings
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Until the later of:
You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Decisions to retain refunds
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Your objection period starts 90 days (plus any time you take to provide additional information we ask for) after you lodge your income tax return. It ends when you receive an amended assessment.
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Luxury car tax (LCT)
You can object to
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How long you have
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Assessments
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For assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Amended assessments
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Until the later of:
For amended assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the amended assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Private rulings
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- Until the time you lodge a BAS that takes into account the matter to which the ruling relates.
For private rulings relating to tax periods that started before 1 July 2012 you have until the later of:
You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Failures to make an assessment
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60 days from the date you gave notice requesting an assessment.
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Decisions to retain refunds
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Your objection period starts 75 days (plus any time you take to provide additional information we ask for) after you lodge your activity statement. It ends when you receive an amended assessment (or equivalent for refunds relating to tax periods that started before 1 July 2012).
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Penalties and interest
Resource rent taxes (petroleum and minerals)
You can object to
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How long you have
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Assessments
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4 years from the date the assessment was given to you.
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Amended assessments
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Until the later of:
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Private rulings
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Until the later of:
You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Wine equalisation tax (WET)
You can object to
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How long you have
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Assessments
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4 years and 1 day from the date the assessment was given to you.
For assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Amended assessments
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Until the later of:
For amended assessments relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the amended assessment was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
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Private rulings
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- Until the time you lodge a BAS that takes into account the matter to which the ruling relates.
For private rulings relating to tax periods that started before 1 July 2012 you have until the later of:
- 60 days from the date the ruling was given to you
- 4 years from the
- end of the relevant tax period, or
- date of importation (for imported goods).
- You cannot object to a private ruling if you have an assessment for the period concerned - object to the assessment instead.
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Decisions to retain refunds
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Your objection period starts 75 days (plus any time you take to provide additional information we ask for) after you lodge your activity statement. It ends when you receive an amended assessment (or equivalent for refunds relating to tax periods that started before 1 July 2012).
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Reviewable wine tax decisions
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60 days from the date the decision was given to you.
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Footnotes to table
Date decision was given to you
This is generally taken to be the date our assessment, notice, ruling, demand, decision or other correspondence was delivered to you or your representative in the usual course of the post.
For self-assessing taxpayers (such as companies and super funds) an assessment is given to you on the day you lodge your return.
For fuel tax credits, GST, LCT, WET and net fuel amounts, an assessment is given to you on the day you lodge your activity statement or return.
Conditions
There are value limits that apply to objections to shortfall interest charge (SIC) and administrative penalties other than tax shortfall penalty.
For penalties, you cannot object to a decision not to remit (waive) a penalty if the amount you are faced with paying is $340 or less.
For SIC, you cannot object to our decision not to remit it if the interest you are left to pay is 20% or less of the shortfall amount. For example, if your shortfall is $2,000, 20% is $400. If the SIC you were left to pay after we had made a decision on remission were $400 or less you could not object to it.
All other taxpayers
This term includes companies, super funds and individuals that are not eligible for the two-year period. For a full definition, refer to Review of your assessment and record keeping.
Extension of time to object
If you want to lodge an objection but are outside the time limit, you must ask for an extension of time. You do this by including a written request for an extension of time with your objection.
Your request for an extension of time needs to ask us to treat your objection as if it had been lodged on time. In your request you need to fully explain the circumstances that caused the delay in lodging your objection. It would be advisable to include details of any efforts you made to lodge within the time limit.
We take up to 56 days (eight weeks) to process a request for an extension of time.
We will notify you in writing whether or not we allow your request for an extension of time.
If we accept your request, we will process your objection.
If we refuse, we will notify you in writing and explain your right to ask the Small Taxation Claims Tribunal to review our decision.
How to object to a decision
An objection must be lodged in writing. You can either use the form we provide or write a letter. Either way, your objection must be lodged within the time limit.
You can fax your request to us, post it, hand deliver it to a shopfront, or have your tax agent lodge it online.
There is no fee for lodging an objection.
What form to use
We recommend you use our form because it guides you to provide the necessary information and sets out the correct wording for your declaration. There are separate versions for taxpayers and tax professionals:
Who can lodge
You can authorise another person (such as a tax agent or a spouse, relative or friend) to prepare your objection. You need to give them written authority to do this.
A legal personal representative (such as a trustee, executor, administrator of a deceased estate or person holding a power of attorney) can also lodge an objection on another person's behalf.
What to include in your objection
Your objection must:
- include full details of why you think our decision is wrong
- contain a declaration that the information provided in the objection and supporting documentation is true and correct
- be signed and dated.
To avoid delays, you should also include:
- your full details or, if you are not the taxpayer objecting to the decision, the full name and contact details, and tax file number (TFN) or Australian business number (ABN)
- full details of the decision you are objecting to, including the relevant year or tax period, where applicable
- any supporting documents and information that relates to the decision being reviewed (we may still need to request more information to help us decide your objection)
- the relevant facts, arguments, information and documents that support the reasons you disagree with our decision - this may include references to
- legislation
- rulings, and
- case law.
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TFN and ABN
We are authorised by the Taxation Administration Act 1953 to collect your TFN. You are not required by law to provide your TFN or ABN; however, providing them reduces the risk of administrative errors that may delay the processing of your request.
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Declarations
For your own objection
You must give a signed declaration with your objection, certifying that the information and documents are true and correct. Include the following declaration and sign and date it.
I certify that the information contained in this document, and any attached documents, is true and correct.
your signature
the date
For someone else's objection
When lodging an objection on behalf of another taxpayer, include the following declaration and sign it.
I certify this document and attached documents have been prepared in accordance with the information supplied by the individual or entity identified on this request and in the attached documents.
I have received a declaration from the individual or entity identified in this request and in the attached documents, stating that the information provided in each document is true and correct.
I am authorised by the individual or entity identified in this request and in the attached documents, to submit this objection request to the Commissioner.
your signature
the date
You also need to obtain a signed declaration from the taxpayer (or an authorised representative) that certifies that:
- the information they provided to you to prepare the objection is true and correct, and
- they authorise you to submit the objection on their behalf.
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Don't include this additional declaration with the objection. However, you will need to produce it if we ask for it.
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How to submit your objection
Tax agents and Business Portal users can lodge online through the respective portal.
You can submit a paper objection to us by fax, post or hand-delivery to a shopfront. Find the relevant fax number and postal address in the table below.
Income tax objections
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Fax
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Post
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Individuals
and
Micro businesses
(less than $2 million turnover)
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1300 139 011
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Australian Taxation Office
PO Box 1130
PENRITH NSW 2740
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Small-to-medium businesses
($2 million to $250 million turnover)
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(02) 6225 0906
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Australian Taxation Office
PO Box 3000
PENRITH NSW 2740
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Large businesses
(group turnover of $250 million or more)
Internationals
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1300 661 106
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Australian Taxation Office
PO Box 377
ALBURY NSW 2640
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Other objections
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Fax
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Post
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Australian business number
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1300 139 035
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The Registrar of the Australian Business Register
PO Box 3003
PENRITH NSW 2740
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Excise, wine equalisation tax, fuel schemes, fuel tax credits, luxury car tax
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1300 650 128
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Australian Taxation Office
PO Box 3524
ALBURY NSW 2640
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Failure to lodge penalties
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1300 139 045
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Australian Taxation Office
PO Box 327
ALBURY NSW 2640
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Fringe benefits tax
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(02) 6225 0906
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Australian Taxation Office
PO Box 3000
PENRITH NSW 2740
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Goods and services tax (GST)
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1300 139 031
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Australian Taxation Office
PO Box 3524
ALBURY NSW 2640
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Investment schemes advice
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1800 033 211
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Australian Taxation Office
PO Box 3546
ALBURY NSW 2640
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Resource rent taxes (petroleum or mineral)
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1300 139 011
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Australian Taxation Office
PO Box 1130
PENRITH NSW 2740
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Superannuation
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1300 669 846
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Australian Taxation Office
PO Box 3100
PENRITH NSW 2740
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How we process your objection
When we process your tax return or an amendment to it, we usually simply process the information you provide. This is not the case with an objection. For objections, we review the facts and evidence you provide and come to a decision.
Within 14 days of receiving your objection, we:
- review your objection and, if necessary, contact you or your representative to discuss it
- request further information, if required, to allow us to make a decision
- advise you if your objection will take longer than usual to decide (particularly where the objection raises complex matters) and negotiate a new due date with you for us to make the objection decision.
You can help ensure that any delays are minimised by responding promptly to any requests from us.
From the day we receive all the necessary information, it normally takes 56 days (8 weeks) to provide you with our decision.
If we decide the objection in your favour, in full or in part, we amend our original decision. If we owe you money, we will pay you, including any interest you are entitled to.
Once we have made a decision on your objection we send you:
- a notice of decision that includes the reasons for our decision
- information on how to seek a review through a tribunal or court if you are dissatisfied with our decision
- information on how to pay any outstanding amount of tax.
If we have not dealt with your objection within 60 days of you lodging it, you can give us written notice to make a decision. If we don't make a decision within 60 days of this notice, your objection is deemed to be disallowed, which allows you to seek an external review by a court or tribunal. If we have requested additional information the 60-day period starts from when you supply the information to us.
Private ruling objections
When considering an objection against a private ruling, we may take additional information into account that we did not consider when making the original ruling. We will tell you what the information is, and give you an opportunity to respond before we make a decision.
If the new information makes a material difference to the facts we based the original ruling on, we may ask you to apply for a new private ruling. If this occurs, your objection is taken not to have been made, and we do not consider it any further.
Further action
If you are dissatisfied with our decision on your objection you can apply for an independent, external review. We explain your options when we advise you of our decision on your objection.
The law specifically gives you the right to go to the Administrative Appeals Tribunal (AAT) or the Federal Court for a review of some of our actions or decisions. In most cases you need to have lodged an objection with us first. There are also other external avenues you could use in seeking to have a review of our decision.
Seek an external review of our decisions
Tax laws specifically give you the right to go to the Administrative Appeals Tribunal (AAT) or the Federal Court of Australia for a review of some of our actions or decisions about your tax affairs. However, in most cases, you must lodge an objection and be dissatisfied with the outcome before you can seek an external review.
There are also other avenues for external review of our decisions.
Administrative Appeals Tribunal (AAT)
The AAT is an independent body that can review some decisions we make about your tax affairs. These include decisions on objections and decisions made under the Freedom of Information Act.
Federal Court and Federal Magistrates Court
You can also apply to the Federal Court and Federal Magistrates Court for a review of our decision on your tax affairs. Court proceedings are more formal and costly than tribunal hearings. You can appear in person or be represented by a legal practitioner.
Time limits
You generally have 60 days from the date of the notice advising you of our decision on your objection to seek a tribunal or court review of that decision. In rare cases, it is 28 days.
Evidence
With a tribunal or court review, you will be expected to prove your claims with evidence.
Test cases
We have a 'test case litigation program' under which we reimburse some or all of your legal costs if we decide your case has important implications for the administration of the revenue system.
More information
Website addresses and contact details if you want to get an application form or find out more about court and tribunal costs and processes.
Other avenues available to you
In addition to your right to have our actions reviewed through the courts, you can approach the Taxation Ombudsman. You can also approach your local member of parliament to ask them to raise questions on your behalf.
Administrative Appeals Tribunal (AAT)
The AAT is an independent body that can review some decisions we make about your tax affairs. These include decisions on objections and decisions made under the Freedom of Information Act 1982 (FOI Act).
AAT proceedings are less formal and less costly than a court case and you can represent yourself (you do not need a solicitor or barrister) but you can be represented by someone if you choose. The AAT can exercise most of the Commissioner's powers and discretions to reconsider the decision and can confirm, vary or set aside our decision.
Your request for review must be in writing and lodged directly with the tribunal. Time limits apply.
An AAT hearing is normally held in public but you can ask for it to be held in private.
After you file an application with the tribunal, it advises us and we send you a statement giving the reasons for our decision. We also send you a copy of our documents relevant to the review.
Small Taxation Claims Tribunal (STCT)
If your claim is for less than $5,000, you can choose to have the Small Taxation Claims Tribunal (STCT) handle your case, which is quicker and less expensive than the AAT.
An STCT tribunal hearing is normally held in public. The STCT can order that a hearing be held in private.
Fees
There is an application fee for both tribunals. The AAT fee can be reduced in some circumstances, for example, if you hold a pensioner concession card. If you have paid the full fee and the AAT decides either wholly or partially in your favour, most of the fee will be refunded. The STCT fee is smaller than the AAT fee but it cannot be reduced or refunded. We will pay it if you are appealing against our decision to reject your application for release from a tax debt due to hardship.
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For information on fees, refer to the Administrative Appeals Tribunal's website.
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Further action
If you disagree with the AAT or STCT on a question of law, you have the right to appeal to the Federal Court.
Federal Court and Federal Magistrates Court
You can go to the Federal Court for an independent review of our decision on your objection. You can also appeal to the Federal Court if you disagree with the Administrative Appeals Tribunal decision or the Small Taxation Claims Tribunal decision on the basis of a question of law.
Additionally, if the law does not allow you to use our internal review process, you can appeal many of our administrative decisions - for example, a decision not to reduce interest on a tax debt - to either the Federal Magistrates Court or the Federal Court.
Your appeal must be in writing and be lodged within the time limit.
After you file an application or appeal with the Federal Court we send you a statement. It sets out the relevant facts, the issues and our contentions. We also send you a copy of our documents relevant to the case.
You can appear in court in person or be represented by a legal practitioner. You must follow the rules required by the Federal Court.
Fees
Court proceedings are more formal and costly than tribunal hearings. Your case may involve a variety of fees such as a filing fee (for your application), setting down fee and daily hearing fees.
Further action
If you are dissatisfied with the decision of a single judge of the Federal Court, you have the right to appeal to the Full Federal Court.
If you are still dissatisfied after a Full Federal Court hearing, you may be able to appeal to the High Court of Australia, but only with special leave of the High Court.
Review of our administrative decisions
Under the Administrative Decisions (Judicial Review) Act 1977 (ADJR), the Federal Magistrates Court and the Federal Court have the power to review many of our decisions. Their role is to ensure we acted fairly and within the law and followed our proper procedures in coming to our decision.
Decisions that are reviewable under the ADJR include our decisions made under any tax law on:
- applications for additional time to lodge
- penalties and charges for late lodgment
- deferring time to lodge or permitting payments by instalments
- reducing charges for late payment.
Either court can set aside the decision and refer the case back to us for further consideration. They can also look into a case if we have failed to make a decision and direct us to make a decision.
Time limits for external reviews
There are limits on how long you have to ask for a review of a decision we have made about your tax affairs.
If you are seeking a review of our decision not to allow an extension of time to object, your case will be handled in the STCT.
Venue
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Time limit
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AAT
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Generally 60 days from the date of the notice advising you of our decision on your objection, but in rare cases it is 28 days.
(If you are outside the time limit you can apply for an extension by lodging an AAT extension application.)
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Federal Court*
|
60 days from the date of the notice advising you of our decision on your objection.
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*Requests for reviews under the Administrative Decisions (Judicial Review) Act must be lodged within 28 days of the date of the notice advising you of our decision on your objection.
Evidence
With a tribunal or court review, you will be expected to prove your claims with evidence. You need to prove that the decision should not have been made or should have been made differently. For example, if you ask a tribunal or court to review a tax assessment, you will need to show that the assessment is wrong. This is because you are the one with the information necessary to establish your true tax position.
You will also need to show what the correct assessment should be. This can be with your own evidence, evidence from other people, inferences or from documents that support your case. The court or tribunal makes its decision based on the law and on the balance of probabilities. This means they must be satisfied that your version of the assessment is, more likely than not, correct.
Test cases
We have a 'test case litigation program' where we reimburse some or all of your legal costs if we decide your case has important implications for the administration of the revenue system.
The program helps us clarify significant issues of tax law where:
- there is uncertainty or contention about how the law operates
- the issue is of significance to a substantial section of the public or has significant commercial implications for an industry, and
- it is in the public's interest for the issue to be decided in court.
More information
You can obtain an application form and further information about review processes in the Administrative Appeals Tribunal and the Small Taxation Claims Tribunal, including fees, by visiting the AAT's website at www.aat.gov.au or phoning 1300 366 700 for the cost of a local call.
You can familiarise yourself with the Federal Court appeals process, including fees, by visiting the Court's website www.fedcourt.gov.au.
For more information on the processes, contact an Administrative Appeals Tribunal or a Federal Court in your state or territory.
Other avenues available to you
In addition to your right to have our actions reviewed through the courts, you can approach the Taxation Ombudsman or your local member of parliament to ask questions on your behalf.
Taxation Ombudsman
You can contact the Ombudsman:
- through the website - www.ombudsman.gov.au
- on the National Complaints Line - 1300 362 072
- by writing to:
The ombudsman considers our processes, the way we administer the tax laws, rather than the details of a taxpayer's particular circumstances.
Request remission of interest charges or penalties
The purpose of the penalty provisions in tax law is to encourage taxpayers to take reasonable care in complying with their tax obligations.
The purpose of charging interest is to ensure that:
- taxpayers who do the right thing are not at a disadvantage to those who don't, and
- government revenue is not disadvantaged by taxpayers who don't pay their tax on time.
We can remit (reduce or cancel) many penalties and interest charges if it would be fair and reasonable to do so. If you are dissatisfied with an interest charge or a penalty, you may ask us to remit it. We can also initiate a remission of interest charges, for example, for voluntary disclosures or where we or other outside factors have been responsible for delays that increase a shortfall period.
Remission of interest charges
We charge interest on outstanding amounts such as unpaid tax debts and shortfall amounts (the difference between the amount of tax you have paid and what you should have paid). We impose the general interest charge on all outstanding amounts except, for some taxes, a shortfall amount, which attracts the shortfall interest charge. In deciding whether to remit (reduce or cancel) an interest charge we consider a number of factors.
Tax types on which the shortfall interest charge can apply are petroleum resources rent tax, excess contributions tax and income tax - including Higher Education Contribution Scheme (HECS), Higher Education Loan Program (HELP) and Medicare levy.
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Having interest charges applied to a shortfall amount does not depend upon, or imply, dishonesty on your part.
You can claim interest charges as a deduction on your tax return.
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Remission of penalties
We impose penalties where taxpayer behaviour warrants some action.
Penalty provisions for a mistake are largely the same, regardless of the particular tax law involved, except for excise, which has a separate penalties regime. If you are dissatisfied with a penalty we have imposed, in most cases you may ask us to remit (reduce or cancel) it. For some penalties you have to object to them using the objection process. In deciding whether to remit a penalty we consider a number of factors.
Remission of interest charges
We charge interest on unpaid tax debts and shortfall amounts.
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Tax shortfall
A tax shortfall is the difference between the amount of tax you were originally assessed for (or refunds you claimed) and the amount of tax you were eventually assessed for (or credits you were entitled to).
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We can remit (reduce or cancel) many interest charges and penalties if it would be fair and reasonable in the circumstances.
If you are dissatisfied with an interest charge, you may ask us to remit it.
We may also initiate a reduction of interest charges for shortfall periods, for example, where you have made a voluntary disclosure or we or third parties have been responsible for delays that increase the shortfall period.
Why we charge interest
The purpose of charging interest is to ensure that:
- taxpayers who complete their tax returns correctly and pay their tax on time are not worse off than taxpayers who lodge incorrect returns and pay less tax than they should, even if this is by mistake
- government revenue is not disadvantaged by taxpayers who don't pay their tax on time.
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Having interest charges applied to a shortfall amount does not depend upon, or imply, dishonesty on your part.
You can claim interest charges as a deduction in your tax return.
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General interest charge (GIC)
We may apply the GIC if an amount (of tax, charge, levy or penalty) remains unpaid after the date on which it should have been paid. This may result from various situations, including:
- a tax shortfall as a result of an amendment of an assessment or other correction
- an instalment of tax being underestimated
- a return lodged late, or
- a failure to remit certain amounts by electronic funds transfer.
Shortfall interest charge (SIC)
The SIC is a lower rate than the GIC (because taxpayers are usually unaware of a shortfall amount until we advise them of it). When we tell you of a shortfall in your tax we also include an interest charge on the shortfall amount.
The due date for payment of the additional tax and for the SIC is 21 days after the day we give you the notice of the additional tax. Once the due date has passed, the higher GIC applies to any unpaid tax and SIC.
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Shortfall penalty
The shortfall interest charge is not the same as the shortfall penalty. Having the shortfall interest charge imposed does not mean there has been any fault on your part.
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How we assess a request for remission
We use different factors when we consider remission of interest charges, depending on whether the charge is for:
- late payment, which incurs the general interest charge (GIC)
- a tax shortfall during the shortfall period, which incurs the shortfall interest charge (SIC).
Remission of GIC
In deciding whether to reduce or cancel the GIC, the factors we consider include:
- whether there were any extenuating circumstances that caused the delay in payment
- what steps you took to relieve the effects of those circumstances
- whether there are special circumstances.
For example, we look at whether you were responsible for the delay in payment or it was outside your control (due to such things as natural disasters, industrial action, the unforeseen collapse of a major debtor or the sudden ill health of key personnel).
If you were responsible, was it an unforeseen result (for example, where a soundly based decision had unforeseen consequences).
Special circumstances that would make remission fair and reasonable include situations where the payment of the full amount of GIC would result in serious financial hardship for you.
Remission of SIC
We use the information you provide as well as other information available to us to consider your request for remission of the SIC. We may remit some, all, or none of the interest charge.
We also initiate remission if it is readily apparent it is appropriate to do so, for example, if:
- we delay the start of an examination or the expected time to complete an examination is exceeded due to our actions
- we cause periods of unreasonable delay during the course of an examination
- during an examination either of us experiences a delay in obtaining information from a third party and this information is not otherwise available to you
- we delay processing your amendment request.
How to request a remission of interest
You can request reduction or cancellation of an interest charge over the phone or in writing (tax agents can do this online through the mail function of the portal). For larger amounts or in more complicated cases, we recommend you write to us.
What to include in a written request
In your letter, explain why you think it is fair and reasonable for us to reduce or cancel your interest charges. If it is a general interest charge, explain in detail the circumstances that led to the delay in payment, including any steps you have taken to reduce the delay. Make sure you include the following information, so we can identify your return (if we have to ask for this information, it will delay processing):
- your full name
- the name, postal address and daytime phone number (if convenient) of a person we can contact about the request
- your tax file number (TFN) or Australian business number (ABN)
- the reference number from any letter or notice advising you of our decision.
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TFN and ABN
We are authorised by the Taxation Administration Act 1953 to collect your TFN. You are not required by law to provide your TFN or ABN; however, providing them reduces the risk of administrative errors that may delay the processing of your request.
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Where to send your request for interest remission
Registered tax agents can submit requests for GIC and SIC remission through the Tax Agent Portal.
Send your request for a remission of SIC to us.
Where you send a letter requesting remission of GIC depends on the tax it was charged on. Select the appropriate address from the following.
Income tax
- by fax to 1300 139 045
- by post to the appropriate address below.
For NSW, QLD, ACT
Australian Taxation Office
PO Box 9102
PENRITH NSW 2740
For WA, SA, NT, VIC, TAS
Australian Taxation Office
PO Box 327
ALBURY NSW 2640
Other fuel schemes and non-BAS claimants of wine equalisation tax (WET) and fuel tax credits
How we advise you of our decision
If we decide not to remit the interest charge in full, we send you a letter explaining why not. The letter also tells you the options available to you if you disagree with our decision.
Further avenues of appeal
Your avenue of appeal against a decision we have made about remission of an interest charge depends on whether it is the general interest charge or shortfall interest charge.
General interest charge
You do not have a formal right to ask us to review our decision in relation to remission of GIC. However, you may seek an independent, external review of the decision in the Federal Court under the Administrative Decisions Judicial Review Act 1977.
Shortfall interest charge
In all circumstances except one, you can request a review of the remission decision. The exception is where, after our decision, the amount you still have to pay is more than 20% of the shortfall itself. In this situation you need to use the objection process to disagree with our decision.
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For more information on interest charges:
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Remission of penalties
There are three types of penalty: criminal, civil and administrative. The first two types are imposed by courts, the latter by us without the need for court action. The various tax laws specify the things that may incur an administrative penalty, for example, not taking reasonable care in claiming a deduction to which you are not entitled or making a false or misleading statement.
Most penalties are defined in terms of penalty units, a unit currently being worth $110.
The law specifies the conditions that make you liable to a penalty and the amount of the penalty. However, we have discretion to reduce (remit) the penalty amount according to individual circumstances, so we frequently remit a penalty before advising you of your tax debt.
If you are dissatisfied with a penalty we have imposed, in most cases you may ask us to reduce it further or cancel it. For some penalties you have to object to them using the objection process.
Why we impose penalties
The purpose of the penalty provisions is to encourage taxpayers to take reasonable care in complying with their tax obligations.
Penalties are generally the same, regardless of the tax law involved. This means that the penalty for making a false of misleading statement is the same whether it relates to income tax, fringe benefits tax, or GST.
How we assess your request for reduction
An underlying principle for us is that taxpayers who under-report their income, over-claim their credits or delay paying their tax should not gain an advantage over taxpayers who report their income or assess their tax liabilities correctly and pay their taxes on time.
In deciding whether to remit a penalty we also consider a number of other factors, including:
In some circumstances, we decide it is fair and reasonable to reduce or cancel (remit) the penalty amount.
Compliance history
We aim to encourage taxpayers with a good compliance history to remain compliant by treating them more leniently than taxpayers who do not have a good compliance history.
This does not mean that if you have a good compliance history you will not have to pay a penalty if you have a shortfall amount. It means we consider all the relevant circumstances, including your compliance history, when deciding whether it is fair and reasonable to remit the penalty in full or in part.
The weight we give to compliance history varies depending on the circumstances. If a taxpayer has behaved recklessly or with intentional disregard for the law, a good compliance history is less likely to influence our decision. Similarly, if a taxpayer has a history of non-compliance, they would generally need to provide clear evidence that the imposition of a penalty would be unjust before we would remit any penalty amount.
A good compliance history is generally one where you:
- have met all your lodgment obligations on time (including lodging activity statements and income tax returns)
- have paid all non-disputed debt (or have a payment arrangement)
- haven't recently been liable to a penalty.
Tax deferred or avoided
If a tax debt was paid late (deferred), rather than permanently avoided, there may be scope to remit the penalty in full or in part. The level of remission would be influenced by the period of deferral and any tax avoided as a result of the deferral.
For example, a taxpayer may account for their GST on the wrong activity statement (that is, in the wrong period). If, after the amendments, there is no shortfall amount in overall terms, the penalty may be remitted in full.
Similarly, if a deduction or credit is claimed in the wrong taxpayer's return or activity statement but there is no shortfall amount in overall terms, a penalty may be remitted in full. If the two taxpayers have different tax rates there will be different shortfall amounts for each taxpayer and a net overall shortfall amount. Where this happens the penalty may be remitted so it equals the penalty that would be applied to the net overall shortfall.
Special circumstances
There may be exceptional cases where the prescribed rate of penalty does not provide a just result to the taxpayer.
How to request a remission of penalty
You may request a review of any penalty decision by phone or in writing. We may ask for the request to be in writing in some circumstances.
You can ask for a reduction or cancellation (referred to technically as partial or full remission) of other penalties, including penalties for failing to:
- lodge documents on time
- withhold amounts as required (PAYG withholding system)
- meet other tax obligations.
In some situations the only way you can pursue remission is through the objection process; in others you can choose to work through the objection process if you prefer.
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For more information on penalties:
For more information on remission of penalties for failure to withhold:
- refer to law administration practice statement PS LA 2007/22 Remission of penalty for failure to withhold as required by Division 12 of Schedule 1 to the Taxation Administration Act 1953.
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Disputing a penalty through the objection process
You need to use the objection process to disagree with penalties for the following:
- a false or misleading statement (in a tax return, business activity statement, fuel scheme claim form or super statement - including member contribution statement, lost member statement and departing Australia superannuation payment report)
- taking an 'unarguable position', that is, treating an income tax matter in a way that is not arguable in law
- schemes.
You may object to any other penalty provided the amount outstanding is more than two penalty units.
What to include in your request letter
When requesting a review of a penalty, include the following information:
- your full name
- the name, postal address and daytime phone number (if convenient) of a person we can contact about this request
- your tax file number (TFN) or Australian business number (ABN)
- the reference number from the letter advising you of our decision
- the reasons you think it is fair and reasonable for us to remit the penalty in your situation.
How to submit a request for penalty remission
Send your request for reduction of a penalty to the address given in the letter advising you of the penalty.
Registered users can do this through the Business Portal and Tax Agent Portal.
How we advise you of our decision
If we don't remit the penalty amount in full, we give you a written explanation of our decision.
Further action you can take
If you disagree with our decision on your request for remission, you may have a number of options available to you, including lodging an objection to the decision. We set out the options available in the letter advising you of our decision.
If you lodged an objection to a penalty and are dissatisfied with our decision on that objection, you can seek an external review of our decision through the Administrative Appeals Tribunal or the Federal Court of Australia.
Last Modified: Monday, 20 May 2013
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