Investigation Process

RevenueSA conducts investigations into the  operations of taxpayers to monitor and address risks associated with compliance  with South Australia’s taxation legislation. In a harmonised environment, payroll tax investigations conducted by RevenueSA may address risks associated with compliance across each jurisdiction in which an employer or group member employs.

This information is provided to help you  understand the investigation process and answer some questions you may  have. It also provides you with some  details of your rights and obligations during an investigation.

How are cases selected for investigation?
What happens when you are selected for investigation?
How do I prepare for an investigation?
What are the Investigator’s powers?
What are my obligations?
What are my rights?
What are the penalty tax and interest provisions?
Can I object or appeal against a decision or assessment?
What about my Privacy?

How are cases selected for investigation?

  • Investigations are selected in a variety of  ways:
  • projects  designed to target specific problems or issues in legislation;
  • industry trend  analysis;
  • tip offs;
  • follow-up of  information received from a variety of sources; and
  • random selection for the routine  verification and coverage of the tax base.

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What happens when you are selected for  investigation?

In most cases an investigator will:

  • write,  telephone or visit you to let you know that an investigation will be conducted;
  • explain the  process and the scope of the investigation;
  • specify the  records to be produced;
  • give you a  reasonable period to assemble those records for either:
    • submission for desk audit; or
    • arranging a time  and place to interview you or your representative; and
  • confirm  arrangements in writing.

At the commencement of the field investigation,  the investigator will present to you his or her identification and authority.

During an investigation, the investigator will conduct interviews and make enquiries to establish your compliance with  the particular legislation and examine and test some of your internal records.

You will receive written advice of the  outcome of the investigation and any proposed action.

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How do I prepare for an investigation?

You should ensure that the records the  investigator has requested are ready for examination. If you require further time to collate the records, please inform  the investigator prior to the commencement of the audit.

If you discover any discrepancies or  undeclared tax liabilities and voluntarily tell the investigator about them  before the interview or at the time records are provided for desk audit, penalties may be reduced.

How long an investigation takes depends to a  large extent on the information you provide, for example, how quickly the  information is provided and how accurate and comprehensive the information is.

When dealing with complex matters, you may  wish to ask your legal or financial representative for advice. We encourage you to do this if it helps you  understand the issues involved.

If you have any questions about the arrangements  for the investigation or the processes involved, contact the investigator for  assistance.

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What are the Investigator’s powers?

Investigators have a range of powers, which  can vary according to the provisions of each Act administered by RevenueSA. In general, these powers permit the  investigator to:

  • gain access to  buildings and property and remain there;
  • inspect,  examine, copy and seize books, documents or records;
  • search  premises;
  • require a  person to answer questions and provide information; and
  • require a  person to give reasonable assistance.

If a taxpayer fails to comply with an  investigator’s lawful requests, it is possible that a prosecution might  result.  Furthermore, this action may  have a bearing on the determination of the taxpayer culpability in the matter  relevant to the level of penalty tax involved or any decision made about the  remission or partial remission of penalty tax.

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What are my obligations?

During an investigation, you are obliged to  provide:

  • the  investigator reasonable assistance and facilities;
  • complete and  honest answers and explanations to questions; and
  • prompt, full  and free access to all relevant information, records, documents, data and  systems as required.

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What are my rights?

If an investigation is to be conducted, you  have the right to:

  • ask for  reasonable time to produce your records;
  • negotiate the  time and place for the investigation with the investigator; and
  • receive written confirmation of those arrangements.

During an investigation, you have the right  to:

  • sight the investigator’s  identification and authority;
  • expect the  investigator to be professional and courteous;
  • involve your  professional representative in the process;
  • ask how long  the investigation will take;
  • expect your  affairs to be treated with strict confidentiality;
  • obtain a  receipt for original copies of records or other material the investigator removes from your  office; and
  • be given the  opportunity to explain the reasons for irregularities, discrepancies, decisions  etc.

At the end of an investigation, you have a  right to:

  • receive an  explanation of the results or findings;
  • ask the  investigator how any penalty tax and interest provisions have been applied;
  • ask for advice  about the objection and appeal process; and
  • discuss any  aspect of your case with the investigator or his or her manager.

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What are the penalty tax and interest  provisions?

Penalty tax will generally apply if tax or  duty has not been paid or has been underpaid.

The amount of the penalty tax depends on the  level of culpability and can range from 25% (or lower) where the taxpayer has  taken reasonable care to comply, through to 75% of the unpaid tax where a  taxpayer has deliberately tried to evade payment of tax. Factors that influence the level of penalty  tax include voluntary disclosure of any underpayment or non-payment of tax  before the investigation commences, or hindering or obstructing the  investigation.

Details may differ slightly depending on the  type of tax or duty involved and on individual circumstances, so you should ask  the investigator for specific information relevant to your case.

Note: There may be differing penalty regimes for Acts not   covered by the Taxation Administration Act 1996, (i.e. currently the First Home   Owner Grant Act 2000 and the Petroleum Products Regulation Act   1995).

Further information is available on the interest and penalty tax page and in Revenue Ruling TAA001 and Information Circular 15.

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Can I object or appeal against a decision or  assessment?

If you are dissatisfied with certain  decisions or an assessment, you are entitled to lodge a formal written notice  of objection with the Treasurer. You  have 60 days from the date of the assessment to lodge an objection.

Lodging an objection does not  remove the responsibility to pay an outstanding amount.  If taxes or duty remain unpaid, interest will accrue. If you are dissatisfied with the outcome of  an objection, you may take the matter further by appealing to the Supreme Court  within 60 days of the Treasurer’s determination.

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What about my Privacy?

Legislative secrecy provisions bind all  RevenueSA employees. Information  gathered during investigations is treated in the strictest confidence and will  not be used or divulged except for purposes required by law.

The Taxation Administration Act 1996 prohibits disclosure of information except to certain authorised persons and  agencies including State and Federal revenue authorities.

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