Detection
We use sophisticated data-matching techniques to detect and assess non-compliance. This includes data exchanged with other revenue offices, government agencies and third parties such as financial institutions, utility companies and vendors or other parties involved in a transaction.
For example, our land tax data-matching programs use ATO rental and trust records as well as data from the Residential Tenancy Bond Authority to identify incorrectly claimed exemptions and trust notification defaults.
Each year, we refine our data-matching programs and build our data warehouses to ensure we maintain our high strike rates on investigations and success rate on litigation. Our aim is to minimise any imposition on compliant customers and only engage with those customers who are non-compliant.
Investigations and litigation statistics
Our well-trained staff and robust data-matching programs achieved the following results for the 2022–23 financial year:
- We completed more than 11,800 investigations and assessed $949 million in tax.
- We achieved a strike rate of over 95% on investigations and received only 647 objections.
- Of those objections lodged, only 62 were allowed in full following an independent review, with the remainder being disallowed in full or part.
- Only 9 objection decisions proceeded to hearing at VCAT or the Supreme Court of Victoria, all of which were decided in favour of the Commissioner.
Investigations
Generally, we will only select you for an investigation if we have obtained information that indicates you have an outstanding tax liability or are ineligible for a claimed exemption, grant or concession. From time to time, particular industries or market sectors may be targeted where non-compliance is identified as a result of an industry-wide practice.
If you are selected for an investigation, we are here to help you understand your rights and obligations under the law. If you wish to be represented by a professional adviser, we are happy to deal with them on your behalf.
At any time during an investigation, you can voluntarily disclose your tax liability to access reduced rates of penalties. Your cooperation and assistance in resolving the investigation in a timely manner is taken into account by us in remitting penalties.
However, if you fail to cooperate by not providing all relevant information in a timely manner or provide false or misleading information, your conduct may be regarded as hindrance of the investigation or the concealment of information.
In such circumstances, a higher rate of penalties may be imposed in relation to your tax default. Your tax liability may also be assessed on an estimated basis by us and your only recourse to correct the liability will be through the objection process, which will require you to provide all relevant information to prove your case.
The requirement to pay an assessment will not be removed on the lodgement of an objection. Interest will accrue while an assessment remains unpaid and in certain cases we may place a charge on property and/or commence winding-up or recovery proceedings to safeguard the collection of the tax.
What to expect from us during an investigation
In accordance with our customer service charter, if you are selected for an investigation, we will:
- clearly explain why you have been selected for investigation
- provide you with a reasonable amount of time to produce your records
- treat your affairs in strict confidence
- provide you with the expected duration of the investigation
- give you an opportunity to seek independent advice, including valuation evidence if required
- give you an opportunity to explain the reasons for your tax default and seek remission of penalties, including interest
- favourably consider your cooperation and the provision of information within the required time frames in determining the applicable rate of penalties and interest.
What we expect from you during an investigation
During an investigation, we expect that you will:
- be courteous, cooperative and honest
- tell us if you have or think you have made a mistake with your taxes, and how and why the mistake occurred
- provide prompt, full and free access to all relevant information, documents, data and systems, including personnel, if required
- provide timely, accurate and complete responses to our requests for information
- work with us to resolve your tax obligations in the most effective manner.
Customer survey
At the end of an investigation, you may receive a request for feedback from us. We value your participation with this survey, which helps us to continually enhance our processes and improve voluntary compliance.
Tip-offs
We also encourage public participation in our compliance efforts by providing a tip-off channel to anonymously report suspected non-compliance. If you are aware of or suspect that a person is not complying with their Victorian tax obligations, you can submit an anonymous tip-off using the link below.
