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  • 10. Resolving disputes

    We continue to use a suite of strategies to prevent and minimise disputes and aim to promote a resolution culture based on:

    • effective communication
    • genuine engagement
    • collaboration
    • strategies that are fair and proportionate to the matters in dispute, and lead to early resolution at minimal cost.

    Objection cases recorded within ATO systems as relating solely to GST have continued to decline. An objection case may relate to one or more objections. The ATO is in the process of revising its methodology for recognising objections related to GST, to capture GST objections reported within systems as relating to other taxes and/or penalties.

    The decline in reported objection cases received relating solely to GST is consistent with the level of objections more broadly for the ATO. Dispute resolution strategies continue to be successfully used – in conjunction with client engagement – to facilitate early dispute resolution. This includes our Dispute Assist service, in-house facilitation, small business independent reviews and other alternatives.

    The use of these services has led to earlier resolution of disputes and prevention of future disputes for both the taxpayer and ATO. Further targeted use is ongoing, noting that resources for these strategies will continue, as will support for our bushfire and COVID-19 affected clients.

    In 2019–20, most GST objections received resulted from audit activity, with the small business client segment the largest contributor of GST objections. The most common objections related to refund integrity, overpaid GST, amendments and real property. We expect these trends to continue in 2020–21.

    There is a slight increase in clients lodging objections regarding:

    • GST registration cancellations
    • self-objections to claim credits with out of time amendments.

    Figure 12: GST-related objection cases created 2015–16 to 2019–20

    2019–20 545. 2018–19 643. 2017–18 906. 2016–17 1,036. 2015–16 1,031.

    Table 8: GST objection results

     

    2015–16

    2016–17

    2017–18

    2018–19

    2019–20

    Finalised objection cases (number)

    1,377

    935

    774

    591

    512

    Allowed in full (%)

    22

    30

    27

    28

    21

    Allowed in part (%)

    33

    20

    22

    18

    18

    Disallowed (%)

    21

    22

    23

    20

    24

    Either withdrawn following initial contact, or invalid and unable to be altered to be treated as valid objections (%)

    24

    28

    28

    33

    37

    Note: A case may relate to more than one objection. Where a case is recorded as allowed in part, this may include a single case involving multiple objections, some of which were allowed in full and others which were disallowed or allowed in part e.g. the case, overall, was allowed in part.

     

    The ATO saw a reduction in objections in the final quarter of 2019–20. We suspect this reflects the impact of shutdowns associated with COVID-19, the reduction in ATO audit and debt activity, and businesses focusing on other immediate issues, including application for stimulus measures. It is not yet known whether the reduction will result in a permanent difference or a deferral of objections to later periods.

    We have maintained a compassionate and empathetic approach to those impacted by these disasters. For clients in bushfire impacted postcodes or impacted by COVID-19, we have considered their circumstances when actioning objections and paused progress until they are ready to continue. Recovery action was paused on all objections affected by bushfires or COVID-19.

      Last modified: 30 Aug 2021QC 64820