The Australian National Audit Office (ANAO) on Tue 25.6.2013, issued Performance Audit Report No 52 of 2012-13 concerning the ATO’s administration of “debt relief” arrangements. Debt relief options available to the Tax Office can include reducing or cancelling a tax debt, or deciding not to pursue the liability. The ANAO noted that in 2011-12, the ATO collected $301bn in taxation revenue, had collectable debt holdings of id=”mce_marker”6.6bn and granted $4.6bn in debt relief.
The audit assessed whether: (i) information was readily available on debt relief options to people in serious hardship; (ii) those cases being considered for debt relief were effectively assessed; (iii) debt cases that were not pursued and re-raised or cancelled at a later date were being appropriately managed; and (iv) debt relief outcomes were accurately reported.
The ANAO reported that the ATO’s management of debt relief arrangements “is generally effective, given the volume of transactions and the extent of the need to have regard to taxpayers’ personal circumstances”. However, the ANAO said there was scope to improve the quality assurance processes for GIC remission to help ensure these decisions are consistently applied. The ANAO made 2 recommendations aimed at: enhancing assurance processes for the remission of GIC; and improving the ATO’s ongoing administration of debt relief arrangements by assessing the extent to which debt release decisions have assisted taxpayers to meet their tax obligations in the longer term. The ATO agreed to both recommendations.
[LTN 120, 25/6/13]