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  • Definitions

    The defined terms following are used specifically in relation to the small super funds income tax gap. Further definitions in relation to our broader tax gap program are available from Principles and approaches to measuring gaps.

    Bottom-up approaches

    Bottom-up approaches involve a detailed examination of data sources. These include tax returns, audit results, risk registers or third-party data-matching information. We then extrapolate the results to establish the extent of non-compliance across the whole population. From this we estimate the tax gap. This approach generally involves applying statistical techniques to estimate the incidence and value of non-compliance. A bottom-up approach is typically used for direct taxes.

    Random enquiry program

    A random enquiry program is a randomly selected sample of small super funds that are subject to internal profiling. From this profiling, where a risk is identified, the sample is escalated to an audit (the random enquiry program). The results of the enquiries are extrapolated to the population using standard statistical formulae to provide a tax gap estimate.

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      Last modified: 17 Oct 2019QC 56336