You are permitted to object against an ATO’s assessment of your tax position if you disagree with the result.
Once you have thoroughly reviewed the ATO’s notice of assessment and believe it to be incorrect, the first step of action is straight forward and relatively informal.
If you believe the details to be inaccurate, please contact us to review your assessment. If after our review, we confirm that the assessment is incorrect, or if you can provide us with additional information that may change your position, we can lodge an amended income tax return with the ATO.
If the ATO disagrees to your amended assessment, we can then lodge an objection on your behalf (advising why we do not agree with the ATO’s disagreement). We can also lodge an objection if the ATO amends an assessment and has taken a different stance to us on particular items, such as, if we believed you were eligible to claim a full deduction but were allowed only part of it.
Objections are required to be made in writing and to include all the details regarding each decision we believe to be incorrect. The objection also includes where appropriate, references to legislation, rulings and/or case law examples. Any additional documents and information supporting the objection would also be included with the submission to the ATO.
From here an ATO case officer is assigned to the objection who will review the original decision made by the ATO, for objectivity the case officer is generally not involved in the original decision. We will then be informed of the outcome in writing (referred to as an “objection decision”). If you are again, still not satisfied with the decision, the next step is to request for an independent external review of the ATO’s actions and its decision in relation to your tax assessment.
The independent external review can often be a costly process depending on the complexity and length of the review, so you need to consider the value of taking this next step.
Tax laws specifically give you the right to go to the Administrative Appeals Tribunal (the tribunal) or the Federal Court of Australia for a review of the ATO’s actions and/or decisions. When the ATO advices of its objection decision, they will also explain how these independent external review options differ. You will then have 60 days from the date of this decision notice to seek a tribunal or court review.
When taking up the tribunal or court route option the burden of proof is on the taxpayer, not the ATO. You will need to go into the tribunal or court hearing able to prove that your view of the tax outcome is the correct one, and support this view with evidence, documents, and comprehensive technical analysis (which GeersSullivan can assist with).
The tribunal is slightly more informal than a court hearing, however, it’s powers are still substantial enough. It can confirm, vary or set aside the ATO assessment. You can represent yourself or be represented by lawyer, and there is an application fee, which would be refunded if the hearing goes your way. Again, if you are not satisfied with the tribunal’s decision you can then appeal to the Federal Court.
From here things become a lot more formal at the Federal Court level. You will generally require legal representation and there are a lot more fees (filing fee, “setting down” fee and daily hearing fee, as examples). That being the case you want to be sure the claim is worth pursuing.
After this level of intervention, the next steps up the legal ladder are the Full Federal Court and then the High Court – but these are rare options for most taxpayers, on top which these courts will not grant every appeal that is requested.
If you do not agree with your ATO notice of assessment or have any questions in relation to an ATO assessment, please contact our office on (08) 9316 7000.