In PwC’s March 2026 Tax Briefing, Patricia Muscat was joined by Bianca Wood, Andrew Korlos, and Ben Bright to discuss how taxpayers can successfully navigate the tax dispute lifecycle. The session focused on Australian Taxation Office (ATO) review and audit activity, how to respond to information requests, when to escalate issues, and the practical steps organisations can take to manage risk and improve dispute outcomes. The webcast emphasised that preparation, discipline in communications and a clear strategy from the outset can make a material difference to both process and outcome.
Understanding how the ATO approaches reviews and disputes
ATO engagement often begins well before a formal dispute arises, through review programs targeting public, large corporate and private groups. These programs consider matters such as tax risk governance, compliance history and ATO tax risks flagged to market. The ATO is increasingly using data analytics and technology to support its reviews. Understanding the ATO’s review framework and likely areas of concern can help taxpayers prepare and respond more effectively.
A key message from the discussion is that organisations should not treat an ATO review as a purely reactive exercise. There is value in identifying risk areas early, understanding the factual history of relevant matters and ensuring internal stakeholders are aligned.
Responding to information requests in a disciplined way
A significant part of the session focused on responding to requests for information. The presenters noted that taxpayers should work through each request carefully, distinguish between background questions and those going to the ATO’s core concerns, and avoid approaching the response as a simple data collection exercise. A disciplined, issue-based approach can help taxpayers respond accurately while also better understanding the risk hypothesis being tested by the ATO.
The session also noted that while a 28-day response period is typical, the timing can be adjusted. Where more time is needed, taxpayers should engage early, request extensions promptly and, where appropriate, consider phased responses.
Managing errors, escalation and objections
The webcast made clear that where errors are identified, voluntary disclosure should be considered early. This can materially reduce penalties and may also help demonstrate cooperation in dealings with the ATO.
Escalation was described as an important but limited use case tool. The presenters cautioned against using escalation routinely, instead reserving it for circumstances where there is a genuine process or technical issue outside the bounds of the ordinary audit process. Escalation is most effective when used selectively and for a clear purpose.
Where matters progress to amended assessments, the discussion turned to objections. Taxpayers generally have 60 days to object and should approach objections with appropriate rigour, including considering whether materials should be prepared to a litigation standard and whether counsel should be briefed.
Looking beyond the technical dispute
The session also highlighted the broader implications of tax disputes. Organisations may need to manage ATO debt quickly, either through payment or early engagement with the debt team, and consider the accounting consequences of uncertain tax positions, including disclosures to boards, audit committees and external auditors.
Another practical theme was the importance of maintaining a constructive working relationship with the ATO throughout the lifecycle of a matter. Taxpayers should remain respectful and cooperative in communications, even where issues are contested or the process becomes challenging.
Using technology to support preparedness
The presenters also pointed to the ATO’s growing use of data analytics, artificial intelligence and machine learning. Taxpayers should likewise consider how technology can be used both defensively, to strengthen compliance processes, and proactively, to identify and organise evidence that supports their position.
Overall, the session reinforced that successful dispute management depends on preparation, sound judgement and a coordinated strategy from the earliest stages of ATO engagement. Tax disputes should not be viewed as isolated events, but as matters requiring clear governance, careful communication and timely decision-making across legal, tax, finance and business teams.
Watch this Tax Briefing on demand here.
