The ATO has recently started referring taxpayers with overdue lodgment obligations to an external collection agency to obtain lodgments on the ATO's behalf. External collection agencies will focus on income tax and activity statement lodgments. Referral to an external collection agency doesn't affect a taxpayer's credit rating.
If a case is referred to an agency to obtain overdue lodgments, the ATO will notify the taxpayer in writing before phoning them or their authorised contact. Letters issued by an external collection agency will include:
- their company name and contact details; and
- details of lodgment obligations the taxpayer needs to give priority.
After the agency has notified the taxpayer in writing, they will phone the taxpayer (or their authorised contact) to negotiate lodgment of the overdue documents and request payment of any debt. When an agency contacts a taxpayer, they will work with them to reach agreement on how they can lodge and subsequently pay any debt.
The ATO assures taxpayers that when it works with agencies:
- the ATO doesn't "sell" the lodgment and payment obligations – the lodgment and payment remain due and payable with the ATO; and
- the agencies aren't paid commissions – they are paid on a fee-for-service basis.