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  • Overall levels of assurance

    At the end of our review, we consider whether sufficient objective evidence has been obtained that would lead a reasonable person to conclude a taxpayer paid the right amount of Australian income tax according to the law. The overall level of assurance is based on an objective view of whether the taxpayer is considered to have paid the right amount of tax.

    Most taxpayers reviewed obtained overall medium assurance ratings. This reflects the complexity of large businesses. It means we need to do more work to obtain overall high assurance. We are confident this additional work will substantially increase our levels of overall high assurance. We set out in the Streamlined Tax Assurance Report (STAR) the next steps for the taxpayer to take to obtain high assurance next time we review their tax affairs.

    Taxpayers that obtained an overall low assurance rating can expect that we will follow up with them to address the specific concerns we identified during the review. While we seek to first resolve our concerns with the taxpayer, there are occasions when we move directly to audit.

    Ratings

    We apply consistent rating categories when considering our overall level of assurance as outlined in Table 1.

    Table 1: Rating categories overall level of assurance

    High

    We obtained assurance that the taxpayer paid the right amount of Australian income tax for the income year(s) reviewed. This means we are unlikely to contact you again in relation to the income year(s) reviewed unless something new comes to our attention.

    Medium

    We obtained assurance in relation to some but not all areas reviewed. For those areas not yet assured, further evidence and/or analysis will be required before we obtain assurance that the taxpayer paid the right amount of Australian income tax.

    Low

    We have specific concerns around the taxpayer’s compliance with the Australian income tax laws and the amount of Australian income tax paid for the income year(s) reviewed.

    The reviews completed to the end of January 2019 resulted in the following overall assurance ratings as outlined in Graph 1:

    Graph 1: Overall assurance obtained

    Graph 1 shows overall assurance obtained is: 17% low, 52% medium, and 31% high.

      Last modified: 30 Jul 2019QC 59607