The newly appointed Inspector-General of Taxation, Ruth Owen, has recommended changes to make it faster and simpler for all taxpayers to lodge an objection with the ATO. 

Ms Owen has released the final report of her review into the ATO’s administration and management of objections and her forward workplan of systemic reviews for 2024-25.  

“Objections are an essential part of the tax system and are often the only affordable option open to many taxpayers to challenge tax office decisions. It is imperative that the function is easily accessed and operates without undue delays.” said Ms Owen.  

“The recommendations I am making today are aimed at practical improvements to the administration of the objections process for all taxpayers, making it easier to access and removing causes of delay.” 

The Inspector-General’s report highlights 4 areas of improvement: 

• increasing accessibility by extending online lodgement to all taxpayers 

• streamlining processes to reduce time and resources devoted to high volume, low risk objections  

• increasing taxpayer engagement to speed up the time taken to complete an objection  

• learning lessons from objections to prevent the number of objections needing to be made. 

On average, the ATO receives and resolves approximately 25,000 objections per a year and has seen a significant increase in recent years. In FY24, it resolved 30,429 objections – approximately 30% more than the previous year. Taxpayers using a registered tax agent can lodge their objection online. But taxpayers who are not represented (and other professionals such as tax lawyers) need to manually lodge their objections by post or fax.  

“We want to see the playing field levelled, so every taxpayer can lodge their objection online. Online lodgement is not only faster, it also provides instant acknowledgement and helps to ensure that all objections lodged are complete,” said Ms Owen. 

Objections to the tax office are generally how taxpayers can challenge a decision of the ATO. However, the process has also become clogged with over half (55%) of those objections received not challenging a decision. These types of objections are most often lodged by taxpayers (or their representatives) simply seeking to amend their tax returns for prior years, where they have run out of time to lodge amendments. Around 85% of these cases are accepted in full or in part.  

Ms Owen said: “There must be a simpler way for taxpayers to adjust their past tax returns that does not involve lodging an objection and waiting for months for it to be resolved. Usually, amendments to past years’ returns are processed in a matter of weeks. So why don’t we look at how such cases can be streamlined and dealt with far more quickly, particularly for low-risk cases. For taxpayers waiting for resolution, that would be a huge weight off their back. 

The report on objections signals a change in the manner and style in which IGTO reviews are undertaken and reported. Ms Owen explained: “I will be undertaking shorter, sharper reviews from now on and will produce more timely and accessible reports. Tax administration touches many aspects of Australian life, and I want my reports to be addressing those issues of greatest interest to the community in real time and to be written in a way that is easy to read and understand.”  

Forward workplan  

The Inspector General has also released her first forward workplan of systemic reviews, following extensive community consultation, including stakeholders across the tax profession, public service, academia and community organisations. The workplan identifies three priority areas for review namely: 

• how the tax system is used as a weapon in financial coercion or abuse  

• the service provided to tax agents through the ATO dedicated agent helpline 

• how ATO can improve their letters to taxpayers, to make them more easily understood 

 

“Our workplan reflects current social and community needs and priorities as well as the pressures being felt within the tax agent profession. It aims to ensure that we devote our resources to topics which are most impactful for the broadest segments of the community,” said Ms Owen. 

In a significant shift, Ms Owen has committed that her office will undertake more focused and targeted reviews with the aim of completing and releasing reports within 3 to 4 months. 

“My reviews are an important and powerful tool to identify improvements and effect change within the tax system. We have had a great response to our consultation document on my priorities and now we are ready to start delivering.” said Ms Owen. 

For further information – contact 

Ruth Owen  

Mobile: 0427 902463 

[email protected] 

 

About the IGTO review of the ATO’s management of objections 

 

Key data: 

• The ATO receives over 25,000 objections per year 

• 40% were lodged by post or fax 

• 96% of objections from registered tax agents were lodged online 

• 87% of objections from unrepresented taxpayers were lodged through non digital channels 

• 55% of objections are from taxpayers seeking to amend prior years’ tax returns. 

• 85% of those were allowed in full or part. 

The IGTO recommendations are for the ATO to: 

1. prioritise a project to deliver an online objection lodgement channel, capture and report on key timeframes and the range of tax professionals who are helping taxpayers with their objections 

1. explore options to streamline objections that are low risk, where the taxpayer is simply seeking to amend a prior year return and to advise Treasury and the Government if no such feasible options exist 

1. consider options to reconsider audit decisions where the taxpayer did not have an opportunity to engage with the ATO 

• improve its feedback framework to share learnings from objections and consider monitoring the impact of the improvements. 

The ATO has agreed in full, in part or in principle with all recommendations made by the IGTO. 

 

 

About the IGTO 

The Inspector-General of Taxation and Taxation Ombudsman (IGTO) is an independent, Commonwealth statutory agency, established in 2003. The Taxation Ombudsman function was transferred to the IGTO in 2015.  

The purpose of the IGTO is to improve the fairness and integrity of taxation and superannuation administration in Australia. The key functions of the IGTO are to: 

 

• investigate and help resolve complaints from taxpayers or tax practitioners on the administration of the ATO or Tax Practitioner Board in a timely and efficient way 

• review and make recommendations on systemic issues relevant to improving tax administration 

• provide independent advice to the Government and Parliament on tax administration, and 

• raise awareness of the role of the IGTO and promote the integrity of the tax system. 

 

 

Ruth Owen CBE was appointed to the role in July 2024.