Application for release from tax debts by the Australian Taxation Office (ATO)
In some cases, the Australian Taxation Office (ATO) has a discretion to release you from paying your tax debts to the ATO.
Generally, you can only apply for release by the ATO if the payment of the tax debt to the ATO within a reasonable timeframe will cause you “serious hardship”. This will depend on your current income, assets and other relevant circumstances.
To maximise your chances of success and get the best possible outcome, you should engage an experienced tax lawyer from King Lawyers to prepare your application for release from your tax debts by the ATO.
If your application with the ATO is unsuccessful, your only appeal option is usually to take the matter to court. This is a very costly and time-consuming process. Therefore, it would be best to avoid this by preparing the best possible application for the ATO’s consideration.
Who can apply for release from tax debts by the ATO?
Generally, you can only apply for release from tax debts if you are an individual or the trustee of the estate of a deceased person.
Companies, trusts and partnerships cannot apply for the release of tax debs by the ATO.
How should an application for release from tax debts be made with the ATO?
A release application must be made in writing with the ATO’s approved form.
Which tax debts may be released by the ATO?
The only tax debts that can be considered for release by the ATO are the following:
- income tax
- pay as you go (PAYG) income tax instalment
- fringe benefits tax
- fringe benefits tax instalment
- Medicare levy
- Medicare levy surcharge
- withholding tax
- mining withholding tax
- penalties associated with these debts
- interest charges associated with these debts
What other issues should you consider before you make an application for release from your tax debts?
Before you make an application to the ATO for release from your tax debts, you should ensure that:
- All of your overdue tax documents are lodged with the ATO (e.g. your outstanding income tax returns and activity statements)
- Any unresolved dispute with the ATO over the underlaying tax issue has been resolved (for example, if you have applied for an objection with the ATO, this need to be finalised before the ATO can consider a release application)
Tax lawyer to help with your application for release from tax debt by the ATO
This content of this article is offered as general information only and should not be relied on as specific legal advice on your application for release from tax debt by the ATO.
To get legal advice from King Lawyers on your specific circumstances, please contact us to arrange an initial consultation with our professional taxation lawyers.