ATO Investigation Powers: Division 353 Notices
Division 353 of the Taxation Administration Act 1953 (Cth) gives the Commissioner extensive access and information gathering powers which are often used at the outset or in the process of an investigation into a taxpayer’s affairs. The ATO can use these formal powers to obtain specific information or documents from not only a taxpayer but also third parties in relation to a taxpayer. Failure to co-operate and respond to a Division 353 Notice can lead to a criminal conviction and an extensive review and audit of your affairs.
Scope of Division 353 Notices
Division 353-10 gives the ATO power to require a person to:
- give the Commissioner any information required for the purpose of the administration or operation of a taxation law
- attend and give evidence before the Commissioner for the purpose of the administration or operation of a taxation law
- to produce to the Commissioner any documents in your custody or under your control for the purpose of the administration or operation of a taxation law.
Division 353-15 gives the ATO the following access powers:
- enter and remain on any land, premises or place
- full and free access at all reasonable times to any documents, goods or other property
- inspect, examine, make copies of, or take extracts from, any documents
- inspect, examine, count, measure, weigh, gauge, test or analyse any goods or other property and, to that end, take samples
Limits of Division 353 Notices
The ATO’s Division 353 Notice powers are not restricted by claims of confidentiality. In particular, the notice operates to override any contractual obligation of the recipient to preserve confidentiality. For example, a notice for the production of documents contained in a safe deposit box will override a bank’s duty of confidentiality. The ATO can also issue a notice to require information kept in Australia about offshore bank accounts.
However, Division 353 notice and access powers are limited in some circumstances. You may be able to claim your documents are protected by either:
1. legal professional privilege
2. the administrative concessions that apply to:
- professional accounting advisers’ papers (the accountants’ concession)
- corporate board advice on tax compliance risk
If you have received a Division 353 Notice in relation to your tax affairs or another taxpayer it is important to seek legal advice and representation to ensure that the ATO are within their rights to make the request and minimise the risk of oversharing information that the ATO do not have a right to receive. For advice or assistance please contact our team of tax lawyers at The Quinn Group on (02) 9223 9166 or submit an online enquiry form today.