The Australian Taxation Office (ATO) imposes behavioural penalties for a range of conduct where taxpayers have failed to comply with their tax obligations. The ATO may also waive (remit) the penalty depending on individual circumstances.
This article provides an overview of behavioural penalties in 2020–21 as outlined by the ATO.
Behavioural penalties in 2020-21
Throughout 2020-21, the ATO imposed 31,128 behavioural penalties, totalling $561.1 million in value. The ATO subsequently remitted $47.3 million (8.4%) of these penalties.
Penalties imposed by penalty type
The table below illustrates the number of penalties imposed by penalty type and the net value of these penalties.
| Penalty type | Number of penalties imposed | Net value of penalties ($m) |
| Intentional disregard of a taxation law (shortfall) | 24,631 | 231 |
| Recklessness (shortfall) | 4,904 | 150 |
| Failure to take reasonable care (shortfall) | 1,468 | 14 |
| False or misleading statements (no shortfall) | 59 | 1 |
| Scheme | 49 | 103 |
| Taking a position that is not reasonably arguable | 17 | 8 |
The most common types of penalties imposed were for intentional disregard of a taxation law, recklessness, and failure to take reasonable care, which produced a shortfall.
The penalties for these behaviours were on average lower than those applied to other behaviours such as where taxpayers have participated in schemes or have taken positions that are not reasonably arguable.
Penalties imposed by tax and program type
The table below illustrates the number of penalties imposed relating to statements and positions for different tax and program types, and the net value of the penalties imposed.
| Tax and program type | Number of penalties imposed | Net value of penalties ($m) |
| Income tax | 3,942 | 375 |
| GST | 25,871 | 115.5 |
| Stimulus | 725 | 7.3 |
| PAYG withholding | 101 | 5.4 |
| Fuel tax credits | 375 | 2.5 |
| Luxury car tax | 27 | 1.2 |
| Fringe benefits tax | 64 | 0.8 |
| Superannuation | 5 | 0.0 |
| Multiple: activity statement | 18 | 0.0 |
Penalties for GST make up most of the penalties. This is followed by penalties for income tax, but the average value of income tax penalties is much higher than GST penalties.
Penalties imposed by organisation type
The table below illustrates the number of penalties imposed by type of organisation and the net value of the penalties imposed.
| Organisation type | Number of penalties imposed | Net value of penalties ($m) |
| Privately Owned and Wealthy Groups | 1,124 | 183.6 |
| Small Business | 27,293 | 183.4 |
| Public and Multinational Business | 372 | 108.5 |
| Individuals | 2,218 | 22.3 |
| Self-Managed Superannuation Funds | 63 | 9.6 |
| Not-For-Profits: Charities | 55 | 0.3 |
| APRA-Regulated Superannuation Funds | 3 | 0.0 |
Key takeaways
If you have failed to meet your tax obligations, you may be liable to penalties from the ATO. Penalties may apply whether you intentionally disregarded a tax law or simply should have been more careful, and whether your misconduct was related to income tax or luxury car tax. Penalties are applicable to everyone, from individuals to multinational businesses.
If you have received a penalty which you believe is not justified, the ATO may use their discretion to waive the penalty.
