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  • Administered - Contingent Liabilities

    Administered Contingent Liabilities
      Tax in Dispute
      2018$'m 2017$'m
    Contingent liabilities
    Balance from previous period 4,588 3,736
    New contingent liabilities recognised 1,737 1,475
    Re-measurement 626 557
    Obligations expired (1,407) (1,180)
    Total contingent liabilities 5,544 4,588

    Quantifiable Administered Contingencies

    At any point in time, the ATO is involved in a range of dispute resolution processes, including litigation, relating to tax disputes. Details of the outcome of dispute resolution processes are uncertain until a court ruling is made and/or an agreement is reached with the taxpayer at some future date. In most cases it is not possible to estimate with any reliability the likely financial impact of current disputes.

    Unquantifiable Administered Contingencies

    In some cases, the decision in relation to the cases above will be precedential. No estimate is able to be made as to whether contingent liabilities exist with respect to other taxpayers who may be impacted as a result of the decision.

    The ATO acknowledges that the incidence of tax evasion and other breaches of the taxation laws, unavoidably affect its fiduciary responsibilities to the Government. As a result, in most cases it is not possible to estimate with any reliability the likely financial impact of current disputes.

    Accounting Policy

    The estimated aggregate value of tax in dispute, for which a liability has not been made, represents the contingent liability. A proportion of these cases will be decided in favour of the Commissioner, and as a result, the future financial impact associated with these contingent liabilities is likely to be lower than the estimated aggregate value of tax in dispute.

    The amount disclosed as a contingent liability represents the total tax in dispute less any provisions recognised. Refer to Note 15 for the accounting policy on allowance for credit amendments and provisions for refunds.

      Last modified: 26 Oct 2018QC 57178