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Managing disputes with large corporate groups

How we resolve disputes with large corporate groups.

Last updated 8 November 2023


We aim to prevent disputes where appropriate. However, where disputes do arise, we work to resolve them as early as possible. Company taxation is complex, especially when applied to the affairs of large corporations. This can and does lead to differences in opinion between us and taxpayers on how the law applies to particular arrangements.

Alternative dispute resolution

Alternative dispute resolution (ADR) involves an impartial person assisting parties in a dispute to resolve or narrow the issues between them. As part of ADR processes, we leverage cooperative relationships. For example, to help resolve valuation and pricing issues, and improve transparency, we:

  • jointly engage experts and conduct discussions between experts
  • examine the information and assumptions underpinning the methodology and valuation to resolve issues
  • only seek another valuation when issues can't be resolved.

Independent review

In certain circumstances, large corporate taxpayers can seek a review of the technical merits of an audit position, before the position is finalised. The review is conducted by a senior officer from a separate area of the ATO, who has no previous involvement with the audit.

Similarly, after issue of an amended assessment, a taxpayer may object against the amendment. Objections are also conducted by senior officers from a separate area of the ATO previously uninvolved in the casework.


In certain circumstances, we may agree to a settlement with the taxpayer, consistent with the code of settlement. We only settle disputes when it's appropriate to do so. Factors we consider in deciding whether to settle are the:

  • relative strength of the parties’ positions
  • cost versus the benefits of continuing the dispute
  • impact on future compliance for the taxpayer and broader community.

Settlement negotiations or offers can be initiated by any party to the dispute. They can occur at any stage, including before assessments are raised.

If multiple taxpayers are involved in the same or similar arrangement, we seek consistency of treatment for taxpayers in comparable circumstances. This may include developing a widely-based settlement position.

Of all client groups, settlements with public and multinational businesses have the lowest variance between the original ATO position and the settled amount.

Independent assurance of our largest and most significant settlements by retired Federal Court of Australia judges gives the community confidence these settlements are fair, reasonable and conducted appropriately under the law.

During 2022–23, 20 settlements with public and multinational businesses were reviewed by our Independent Assurance of Settlements Program. The reviews found those 20 settlements provided a fair and reasonable outcome for the Australian community.

For information on settlement statistics, see:


In some cases, ADR and settlements are not appropriate. In these cases, we proceed to litigation.

We litigate in cases where either:

  • a contentious or uncertain point of law requires clarification – it's in the public interest to seek law clarification through litigation
  • the behaviour requires us to send a strong message to an individual or the wider community that it isn't tolerated
  • the dispute is intractable and an acceptable outcome wasn't achieved via alternative means of resolving the dispute.

Test case litigation program

The test case litigation program funds cases with implications that:

  • are broader than the individual dispute
  • will clarify the tax and super laws we administer.

The program seeks to ensure the community is provided with clear principles about how to apply the law. The financial assistance it gives to taxpayers helps them to meet some or all of their reasonable litigation costs and, in limited circumstances, pre-litigation costs.

For taxpayers to receive funding, their dispute must meet the program’s funding criterion and expectations. The decision to fund a case is made by the Test Case Litigation Panel.

The panel has 5 members, 3 are external to the ATO.

The panel gives independent views on the merits of cases seeking funding and on the significance of issues to the community.