State Revenue audits

State Revenue's audit and investigation process.

While we rely on the honesty of taxpayers and grant recipients to voluntarily self assess and comply with their tax and other obligations, we conduct audits and investigations to protect the integrity of our tax system and ensure equity for all taxpayers. This ensures the correct amount of tax or duty is paid, and that grant recipients are eligible and comply with the requirements. 

We identify who to audit and investigate through

  • information received from third parties including government agencies and members of the public
  • data matching and IT-assisted research
  • risk analysis
  • field visits and other audits
  • random sampling and routine verification of the tax base.

Confidentiality provisions in the legislation bind all Office of State Revenue employees.  Information gathered during audits/investigations is treated in the strictest confidence and will not be used or divulged except for purposes required by law. The disclosure of information to third parties is prohibited except to certain authorised persons and agencies, including State and Federal revenue authorities.

Audit selection

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What happens when you are selected for an audit or investigation.

In most cases we will

  • write, telephone or visit you to let you know that an audit/investigation will be conducted
  • explain the process and scope of the audit/investigation
  • specify the records to be produced
  • give you a reasonable period to assemble those records
  • arrange a time and place to conduct the audit/investigation
  • confirm arrangements in writing

Before the audit/investigation starts, the investigator will show you their identification and authority. During the audit/investigation, the investigator will conduct interviews and make enquiries to establish your compliance with the particular legislation, and will examine and test some of your records. You will be advised of the outcome and any proposed action.

Preparing for an audit/investigation

Make sure all relevant records are ready for examination. Please let the investigator know beforehand if you need more time to collate the records.

The length of the audit/investigation generally depends on how quickly you provide the information and how comprehensive it is. You may wish to ask your legal or financial representative for advice.

If subcontractor determinations are involved, only the subcontractor and their representative is allowed to attend.

If you have any questions about the arrangements or processes, please contact the investigator.

Your obligations and rights

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There are certain things you must and can do.

Your legal obligations

During an audit/investigation, you are required to provide the investigator

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

Investigators have authority to

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

We may take prosecution action if you mislead or obstruct an investigations officer.

Your rights

Before an audit/investigation, you have the right to

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

During an audit/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 audit or investigation will take
  • expect your affairs to be treated with strict confidentiality
  • obtain a receipt for records or other material the investigator removes from your premises
  • be given the opportunity to explain the reasons for irregularities, discrepancies, decisions etc.

At the end of an audit/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
  • discuss any aspect of your audit or investigation with the investigator or their manager.

You may claim legal professional privilege during the course of an investigation or audit.

You have the right to lodge an objection if you are dissatisfied with a decision.

Keeping records

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Keep all relevant tax records to ensure you to meet your statutory obligations and are paying the correct amount of tax.

Records must be retained for at least 5 years after they were made or the transaction to which they relate is completed.

Tax records constitute a record required under a taxation Act, regulation or under a special tax return arrangement. 

Records must be kept

  • on paper, digitally or as part of a software program
  • in the English language or in some other form that can be readily converted into English
  • in Western Australia or be otherwise made available for investigators.

Western Australia’s legislation authorises investigators to have full and free access to all premises, documents, books and other records that are required to determine your tax liabilities.

You are committing an offence and can be charged with a penalty if you

  • fail to comply with the record keeping requirements
  • keep or make an entry in a tax record knowing that it is false or misleading in a material particular, or wilfully damage or destroy a tax record.

An exemption from the requirement to keep a tax record may be given by regulation or by a notice issued by the Commissioner.

Penalties

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We may impose penalty tax.

Contact

Telephone:
61 8 9262 1400
1300 368 364 (WA country landline callers)
Page reviewed 19 September 2019