The Top 1,000 population
The Top 1,000 population is made up of the largest 1,000 publicly listed and multinational corporate taxpayers and APRA regulated superannuation funds, excluding those covered by the Top 100 Program.
Taxpayers in the population are diverse in terms of their ownership, business models, industries and size, and they have substantial economic activity related to Australia. They are key participants in the tax system across corporate income tax, excise, petroleum resource rent tax and GST. Currently, entities in the population generally have turnover exceeding $350 million.
Other factors will be relevant such as taxpayer industry, and whether any significant transactions or risks have come to our attention that are best reviewed through the assurance program.
Given the diversity of taxpayers in the population, for income tax we differentiate taxpayers into either the:
- significant pool, where taxpayers generally have turnover above $1 billion and comprise around one-third of the population
- general pool (all other Top 1,000 taxpayers).
For superannuation funds the significant pool threshold is based on turnover of $5 billion or more, reflecting the higher turnover of superannuation funds.
Based on the 2023–24 income year tax returns, taxpayers in the population paid about $25.6 billion or 18% of all corporate income tax, with:
- significant taxpayers paying $16.7 billion or 12% of all corporate income tax
- general taxpayers paying $8.9 billion or 6% of all corporate income tax.
A further $12.8 billion of income tax was paid by superannuation funds in the population comprising:
- significant superannuation taxpayers paying $8.7 billion
- general superannuation taxpayers paying $4.1 billion.
Additionally, in the 2023–24 income year taxpayers in the population reported and paid $25.3 billion of net GST or 31% of total net GST collections.
We regularly review the composition of the population to ensure it continues to reflect the largest 1,000 taxpayers outside the Top 100. While the population is generally stable, economic conditions and events may result in changes over time.
Taxpayers that fall outside the Top 1,000 population remain subject to our broader risk-based compliance approaches and may be selected for targeted reviews where specific issues or risks are identified.
When determining which taxpayer to review for GST, we generally select the GST reporter with the highest throughput within the economic group.
Justified trust and transparency
Tax compliance is a focus among boards, investors, customers or consumers, suppliers, community groups and other stakeholders concerned with how organisations contribute to the communities in which they operate. Many see this as an important component of Environmental, Social and Governance (ESG) performance indicators. We have observed that our justified trust ratings are used by organisations to demonstrate their community and ESG credentials as part of their broader social licence to operate.
The objective principles used in the justified trust initiative also serve to enhance the community’s understanding about large market compliance. Although there remains a level of non-compliance by some in this population, we continue to address this robustly. Our results to date demonstrate that most large businesses do, and want to do, the right thing. We have a high level of willing participation by most large corporate groups. This is shown by high or medium assurance rates for income tax (89% in total) and GST (95% in total). There are also examples of companies that have committed to long-term behavioural change, including restructuring, changing their business practices, and settling long-standing disputes with us.
We encourage the continued adoption of tax transparency practices (including the disclosure of assurance ratings) which supports community confidence that the largest taxpayers are paying the right amount of tax.
Our approach
Our justified trust assurance programs focus on assuring that the largest public and multinational businesses have paid the right amount of tax. These programs provide an important foundational level of confidence about tax compliance across the various behaviours addressed by the public-and-multinational-business-three-tier-model.
For both income tax and GST, we apply the justified trust methodology and seek to obtain assurance for these 4 focus areas:
- Appropriate tax risk management and governance frameworks exist and are applied in practice – this includes the design of business systems to create, capture and report transactions correctly for GST purposes.
- None of the specific income tax or GST risks we have flagged to the market are present.
- Tax outcomes of atypical, new, or significant transactions are appropriate.
- We understand why the accounting and tax results vary – by analysing the various streams of economic activity and how they are treated for taxation purposes. We also analyse the sales, acquisitions, and other data, and compare this to net GST paid.
We engage with taxpayers through a combined assurance review product under which both income tax and GST are to be assured at the same time.
Differentiated treatment approach for income tax
For income tax we differentiate our assurance approach based on factors such as their size and assurance already attained. We consider taxpayer pool and outcome of previous assurance reviews when determining the scope of our income tax assurance reviews. We further tailor our reviews by reviewing information and documentation already provided to us through structured reporting (including income tax returns and schedules, Country by Country reporting) and through earlier engagements.
For significant pool taxpayers:
- we assure the income tax reported and paid for all 4 years of the review period
- we consider recommendations made in the previous assurance review
- where the taxpayer has achieved both a high or medium overall assurance rating and a stage 2 or 3 tax risk management and governance rating, we will
- further tailor our review to take a lighter touch approach
- focus on objective evidence from the last year of the review period, along with evidence of any significant transactions, events or risks identified in other years.
For general pool taxpayers, we:
- assure the income tax reported and paid in the last year of the review period
- review any new or significant transactions, events or risks flagged to market in the other years of the review period
- consider any recommendations that were made in previous reviews
- apply a lighter touch approach by leveraging from our earlier engagement where possible (where the taxpayer has achieved a high or medium overall assurance rating and a stage 2 or 3 tax risk management and governance rating).
Differentiated treatment approach for GST
For GST, we:
- apply a differentiated approach to assuring GST for taxpayers where we already have some assurance as to their reporting for GST through an earlier review
- use the responses to the Supplementary annual GST return to tailor our engagement.
The introduction of the SAGR enables us to better target the scope of our reviews and to only request further information if needed. In these cases, we have regard to the SAGR responses before commencing our engagement to tailor the scope of the review and our information requests. In some instances, we expect SAGR responses will provide sufficient information without the need to undertake further review.
After the review
We continue to provide recommendations to taxpayers on how to improve and what actions the taxpayer should take at the end of the assurance review.
For GST taxpayers are required to provide details of actions taken to address GST recommendations in their SAGR lodgment.
Where the identified concern is assessed as requiring ATO intervention to resolve (through review or audit), matters may also be escalated for further investigation as part of our Top 1,000 Next Actions Program.