• Applying for compensation

    To apply for compensation, complete the Applying for compensation claim form. Attach all relevant documentation to support your claim. You can either send, fax or email your claim to us, at the address at the end of the form.

    Find out about:

    Next step:

    Assessing a claim

    We assess claims for compensation in two ways, either:

    • compensation for legal liability (for example, negligence)
    • compensation under the Scheme for Compensation for Detriment caused by Defective Administration (CDDA Scheme).

    Claims are considered by officers in our General Counsel. Decision makers are independent of the area of the ATO who previously dealt with your matter.

    Claims that are resolved on the basis of legal liability must be settled in accordance with legal principle and practice. Any settlement must be consistent with our obligations under Appendix C to the Legal Services Directions 2005External Link.

    The criteria used by decision makers in deciding CDDA claims is set out in the Department of Finance's Resource Management Guide 409 (PDF 168KB)This link will download a file.This link will download a file

    If compensation of either type is not appropriate, you may be eligible for an act of grace payment. The Department of Finance administers these payments, not the ATO. See Act of Grace PaymentsExternal Link information on the Department of Finance website.

    Losses that can't be considered

    Generally, claims for the following types of losses can't be considered under claims of legal liability or the CDDA Scheme:

    • claims for personal time spent resolving an issue
    • claims for stress, anxiety, inconvenience
    • claims for delay in receiving funds from the ATO where statutory interest was paid
    • claims for costs associated with complying with the tax system including costs associated with audits, objections and appeals – even where it is found you complied with your obligations
    • costs of putting in a claim or conducting a claim for compensation
    • claims for taxation or other Commonwealth liabilities with substantive review rights that can be or could have been pursued.

    Compensation is not payable to offset tax debts that are lawfully owing. See information to help you manage your debt at Help with paying.

    Losses we can consider

    Types of compensation we can consider are financial losses with a direct connection to our actions that lead to a finding of legal liability or defective administration. These can be losses such as:

    • professional fees, where evidence of payment is provided and the fees are considered by the decision maker to be reasonable (our assessment of what is reasonable may differ from yours)
    • interest for delays in providing funds in cases where no statutory interest can be paid
    • bank or other administrative fees you incurred because of our actions.

    Service standards

    We aim to acknowledge receipt of your compensation claim in writing within seven business days of receiving it.

    Once you provide all necessary information in support of your claim, we aim to process initial claims within 56 days.

    Some complex claims and internal reviews may take longer to investigate and consider. In these cases, we will contact you about an extended reply date.

    If you did not provide us with all the information we need to make a decision on your claim, we will contact you to tell you what information we need. We will also provide a timeframe for the conclusion of your claim.

    We will not consider your claim until your original issue (that led to your claim) is resolved. If you are involved in other dispute resolution processes, including court or tribunal action, these need to be resolved before we consider your claim.

    Receiving payment

    If your claim is successful, we transfer payment electronically into your nominated bank account.

    If you're unsure whether the payment is taxable, you can seek advice from a tax professional. You can also contact us, or ask for advice and guidance (for example, a private ruling).

    Reviewing the decision

    Internal review

    There is no automatic right of administrative review of decisions under the CDDA Scheme. Our approach is to offer internal review where the claimant can provide new and relevant information or contentions in support of the claim.

    Inspector General of Taxation

    The Inspector-General of Taxation can investigate most complaints related to tax administration including the handling of compensation claims.  The Inspector-General has no power to overturn or vary our decision but may make recommendations to us about how the claim was handled. 

    You can contact them via the Inspector-General of TaxationExternal Link website or by phone on 1300 448 829.

    More information

    Compensation from the ATO

    Contacting the ATO

    Act of grace payments

    • Act of grace payments at www.finance.gov.au

    Help with managing your tax debt

     

     

    Last modified: 31 Aug 2016QC 17735