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The main interactions most Australians have with the Australian Taxation Office (ATO) are lodging an income tax return each year and having tax taken from their pay. The ATO interacts with almost every sector of the community. Each year, the ATO processes tax returns for around 13 million personal taxpayers and 2 million businesses and non-profit organisations.

The aim of the ATO lodgment system is for everyone to pay the correct amount of tax. The ATO aims to make people who hide income and evade their tax obligations pay the correct amount.

The Australian taxation system works on the principle of self-assessment. This means that the information supplied by the taxpayer is usually accepted as being correct when the return is lodged. The ATO may later check the details with the taxpayer and against other sources of information. If someone has not declared all their income, or has made a claim for something which they are not entitled to, they must pay the tax they owe and may have to pay a penalty.

The Your tax and Business tax sections provide a more detailed explanation of tax return preparation and lodgment.

The main responsibility of the ATO is to administer the Australian Government’s tax and super legislation. The ATO is the main revenue collection agency for the Australian Government.

Commonwealth Government revenue provides over 80% of Australian Government  revenue, which funds the implementation of social and economic policies.

Some of the responsibilities of the ATO in administering legislation are:

  • collection of revenue, including GST
  • aspects of the superannuation system
  • excise
  • income tax, including PAYG withholding and instalments
  • fringe benefits tax
  • grants and schemes relating to fuel
  • sharing information with Centrelink, the Child Support Agency, the Australian Bureau of Statistics and the Department of Immigration and Citizenship
  • collection of the Higher Education Contribution Scheme (HECS) and Higher Education Loan program (HELP) debt through the taxation system
  • the Australian Business Register (ABR) and the Australian Business Number (ABN) system.
  • Fact 13

    During World War I, many taxpayers felt that it was their patriotic duty to pay more than their assessed tax. Some were not legally obliged to pay tax but did so and others made payments of double, treble or quadruple the assessed amounts.

Business activity statement (BAS)

A single form used by businesses registered for GST to report their business tax entitlements and obligations including GST, PAYG instalments, PAYG withholding and FBT instalments. See also instalment activity statement.

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