While the Australian Taxation Office (ATO) has formal powers to access documents and evidence, it prefers to cooperate with taxpayers to obtain these where possible. However, sometimes the ATO issues a notice to attend a formal interview. This article explores the key considerations outlined by the ATO.
When may the ATO issue a notice to attend a formal interview?
Situations in which the ATO may issue a notice to attend a formal interview include when they:
- Consider an interview is the best way to resolve a complex issue.
- Believe you may be involved in tax avoidance.
- Believe you may have information about a taxpayer who is involved in tax avoidance.
- Require an explanation about the nature of a transaction.
- Need to ask wide-ranging questions.
- Plan to show you documentation to assist in your recollection of events.
- Need to establish, clarify or check facts.
- May require evidence from you on oath or affirmation.
- Require information about another person or entity’s tax affairs.
If you do not attend the interview after receiving a formal notice, you may be prosecuted.
Who may attend the interview?
In addition to the ATO officers named in the notice, a number of people may attend the interview, including:
- Assistants to help with the administrative aspects of the interview.
- Interpreters.
- Stenographers and note takers.
- Legal representatives to assist ATO officers.
The ATO’s lawyers may be present for various reasons including where there are complex claims for legal professional privilege, the accountants’ concession or the corporate board advice concession, or where you have advised the ATO that you are to be accompanied at the interview by a lawyer.
Although you do not have a legal right to be accompanied by another person at a formal interview, the ATO usually allows you to bring one or more persons of your choice to assist or advise you at the interview. Your representative may be a professional adviser such as a lawyer, an interpreter, friend, spouse, or other family member.
What you can expect
The ATO will explain your rights and obligations before the interview starts. They will explain the interview procedure, that the interview will be recorded, and your compliance requirements. For example, you must personally answer all questions – your representative cannot answer on your behalf.
The ATO may require you to produce documents. Whether they examine these documents during the interview, copy them or retain them for later examination will depend on the number of documents and the complexity of the issues under examination.
Legal implications and recourses during the interview
It is an offence to make a false or misleading statement during the interview, and you may be prosecuted for doing so. Refusal to answer a question is also an offence, and the privilege against self-incrimination is not a defence for failing to answer.
During an interview, you may be able to claim legal professional privilege, the accountants’ concession or the corporate board advice concession. If you make a claim, the ATO may consider adjourning the interview for a brief period to consider your claim.
Key takeaways
If the ATO issues a notice for you to attend a formal interview, you are legally obligated to attend, and to truthfully answer all questions asked of you. You will usually be allowed to have someone accompany you at the interview, such as a lawyer, who will be able to provide guidance in various aspects of the interview, such as whether you can claim legal professional privilege or another concession.
