Taxpayer Rights During ATO Audits in New South Wales
Reviewed by the Commoner Law Editorial Team. Sourced from Commonwealth Acts of Parliament, federal regulations, and official government guidance. State-level information reflects each state's own Acts and court decisions. Written in plain language for general understanding — this is educational content, not legal advice. Our editorial standards
What is this right?
The ATO has the power to audit any taxpayer's affairs under the Taxation Administration Act 1953. An audit is a check to make sure you reported your tax affairs correctly. It is not a criminal investigation.
The Taxpayer Charter sets out your rights when dealing with the ATO. You have the right to be treated fairly and reasonably, to receive clear explanations of ATO decisions, and to have your privacy protected.
You have the right to be represented by a registered tax agent, accountant, or lawyer during an audit. The ATO must deal with your representative if you have authorised one. You also have the right to legal professional privilege, which means confidential communications with your lawyer cannot be forced to be disclosed.
The ATO must give you reasonable time to respond to requests for information — usually 28 days. If the ATO decides to adjust your tax, they must give you a written explanation and tell you about your rights of review. Audits generally cover the last 2 years for individuals and 4 years for more complex matters, though fraud has no time limit.
When does it apply?
This applies to any individual or business selected for an ATO audit or review.
- The ATO may contact you by letter, phone, or through your myGov inbox.
- Audits can cover income tax, GST, superannuation, fringe benefits tax, or any other tax obligation.
- Being audited does not mean you have done anything wrong.
What to Do If the ATO Has Selected You for a Tax Audit in Australia
- Read the audit notification carefully — it will explain which tax years and issues are being reviewed.
- Appoint a registered tax agent or lawyer to represent you if you are not comfortable dealing with the ATO directly.
- Respond within the timeframes given — usually 28 days.
- Provide only what is requested — you are not required to volunteer extra information.
- Keep copies of everything you send to the ATO.
- If you believe the ATO is acting unfairly, you can complain to the Inspector-General of Taxation and Taxation Ombudsman.
What should you NOT do?
- Don't ignore the audit — the ATO can proceed without your input and issue an amended assessment.
- Don't provide false or misleading information — this can lead to serious penalties or criminal prosecution.
- Don't destroy records — you must keep records for 5 years, and destroying them during an audit is an offence.
- Don't waive legal professional privilege without advice from your lawyer.
- Don't agree to an outcome you believe is wrong — you have the right to object.
How New South Wales differs from federal law
ATO audit powers apply nationally, but NSW taxpayers also face potential audits by Revenue NSW for state taxes including payroll tax, land tax, and stamp duty.
- Revenue NSW has its own compliance and audit division. It can conduct payroll tax audits on NSW employers, land tax compliance reviews, and stamp duty reassessments.
- Revenue NSW auditors can require production of records, issue assessment notices, and impose penalties for understatement of state tax liabilities (Taxation Administration Act 1996 (NSW)).
- During a Revenue NSW audit, you have the right to be informed of the reason for the audit, to provide information and documents, and to engage a tax agent or legal representative to act on your behalf.
- Revenue NSW publishes compliance guidelines and rulings that set out its interpretation of NSW tax laws — these can be relied upon as a defence if you followed a published ruling in good faith.
Additional Steps in New South Wales
For ATO audits, contact a registered tax agent. For Revenue NSW audits, engage a solicitor or tax adviser with NSW state tax expertise. Revenue NSW can be contacted on 1300 368 710. Dispute an assessment through the Revenue NSW objection process before escalating to NCAT.
Relevant Law: Taxation Administration Act 1953 (Cth); Taxation Administration Act 1996 (NSW); Revenue NSW Compliance and Enforcement Policy
Common Questions
When does taxpayer rights during ato audits apply?
This applies to any individual or business selected for an ATO audit or review.The ATO may contact you by letter, phone, or through your myGov inbox.Audits can cover income tax, GST, superannuation, fringe benefits tax, or any other tax obligation.Being audited does not mean you have done anything wrong.
What should I do if I receive an audit notice from the ATO in Australia?
Read the audit notification carefully — it will explain which tax years and issues are being reviewed.Appoint a registered tax agent or lawyer to represent you if you are not comfortable dealing with the ATO directly.Respond within the timeframes given — usually 28 days.Provide only what is requested — you are not required to volunteer extra information.Keep copies of everything you send to the ATO.If you believe the ATO is acting unfairly, you can complain to the Inspector-General of Taxation and Taxation Ombudsman.
What mistakes should I avoid with taxpayer rights during ato audits?
Don't ignore the audit — the ATO can proceed without your input and issue an amended assessment.Don't provide false or misleading information — this can lead to serious penalties or criminal prosecution.Don't destroy records — you must keep records for 5 years, and destroying them during an audit is an offence.Don't waive legal professional privilege without advice from your lawyer.Don't agree to an outcome you believe is wrong — you have the right to object.
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