Understanding Your ATO Notice of Assessment and the Impact on Your Finances

Understanding your ATO notice of assessment can change how your tax is calculated.  A Notice of Assessment is generally issued to us individually by the ATO when we lodge, and the ATO ultimately processes our individual income tax return.

Recently, the ATO confirmed the contents & updates to all Notices of Assessment. We now bring the following to your attention:

What a notice of assessment contains

Your notice of assessment (NOA) is the statement the ATO issue that explains how your tax assessment is calculated. Your NOA will show the amount of:

• The tax you owe on your taxable income, and
• The credit you have for tax already paid during the income year, and
• The tax you need to pay or your refund entitlement, and
• any excess private health reduction or refund thereon (if applicable).

When you receive your notice of assessment, you should check everything is correct. If you have a myGov account and link it to the ATO, your NOA and tax receipt are sent to your myGov Inbox.

If you have a tax debt, check your NOA – it will include your payment advice and due date.

Under the law, the ATO have a period of time to review your income tax return. During this time, they may increase or decrease the amount of tax payable or refundable on your initial NOA. This review period is normally 2 years, but in certain circumstances it can be 4 years.

When is a notice of assessment sent?

The ATO will send your NOA to you after they process your income tax return lodgement. The processing timeframes the ATO aims for depends on the lodgement method you use. If you lodge:

• online using myTax, they aim for processing within 2 weeks,
• by paper, they aim for processing within 50 business days (10 weeks) from the date we receive the lodgement (paper lodgments may take up to 7 weeks to show on the ATO systems),
• through a tax agent, they aim for processing within 2 weeks.

Why your tax return outcome may change in 2023.

The outcome of your 2023 income tax return may be different than in previous income years. You may have a lower refund, or you may even receive a tax bill.

Understanding your ATO notice of assessment and your income tax return outcome may change for any of the following reasons:

• A tax offset you received previously is no longer available or you are no longer eligible for an offset – for example, the low- and middle-income tax offset ended on 30 June 2022
• Your credit or refund has been offset against other debt – including debts on hold with the ATO or debts you have with other government agencies (for example, Centrelink),
• Your income or deductions for the income year are different from previous income years,
• The ATO finds a difference between the details in your income tax return and the information they may receive through pre-fill data or their data matching program
• You have not advised your payer of your study or training support loan and your income is above the minimum repayment threshold – this will result in a compulsory repayment amount.

Some debts will not be applied to your income tax return until after it is lodged. This means your tax estimate in myTax or from your registered tax agent may not match your final tax outcome.

If you believe you will get a tax bill, it’s still important to lodge your tax return on time even if you can’t pay immediately.

Get a copy of your notice of assessment.

If you have a myGov account, your NOA and tax receipt is sent to your myGov Inbox. You can view and print some NOA from the myGov Inbox.

If you require a copy of a current or previous income year NOA and you can’t locate it in your myGov Inbox.

If you think your notice of assessment is wrong.

Check all the details on your NOA with the details you submitted in your income tax return. If you made a mistake when completing your return, you can correct (amend) your income tax return.

You can dispute or object to your NOA if you are dissatisfied with it or if you disagree with the ATO’s decision to retain a refund. Generally, you must lodge your objection within the 2 year or 4 year amendment period, whichever applies to you. 

Understanding your ATO Notice of Assessment is crucial for effective financial planning. At Financially Sorted, we are committed to providing you with valuable insights and guidance to ensure you make well-informed financial decisions. Stay ahead of the game and manage your finances with confidence.

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