Refunds and amounts owing

A historic Australian post box in Bassendean, Western Australia. Photo: Wikimedia Commons, CC BY-SA 4.0.

An Australian ten-shilling banknote from 1918. Photo: Wikimedia Commons, Public domain.

A registered mail envelope. Photo: Wikimedia Commons, Public domain.

After you lodge, the ATO sends you a notice of assessment. It is the final word on your tax for the year: it shows your taxable income, the tax and levies payable, the offsets applied, and the tax already withheld. The difference is either a refund to you or an amount you owe.

Why you get a refund

You get a refund when more tax was withheld from your pay during the year than you actually owed — for example, because you claimed deductions, because your employer withheld at a higher rate than your final marginal rate, or because an offset reduced your bill. Refunds are paid to the bank account in your myGov record, so keep those details current.

Why you might owe money

You owe money when too little tax was withheld. Common reasons: claiming the tax-free threshold from two employers at once, having investment or business income with no withholding, receiving government payments, or a pay rise that moved you into a higher bracket without your withholding catching up. Owing money is not a mistake by itself — it is the system reconciling.

Timing

Most online returns are processed within 12 business days, and refunds generally arrive within two weeks of the assessment. Amounts owing are generally due 21 days after the notice of assessment issues — the exact date is printed on the notice. If you owe tax and pay late, general interest charge applies, and since 1 July 2025 it is no longer tax-deductible.

If you cannot pay in full

Contact the ATO before the due date. Payment plans are available, and the ATO can also offset a refund against other government debts you owe, such as a HELP debt or a Centrelink debt. Ignoring a bill does not make it go away: interest keeps accruing and the ATO can take stronger recovery action. If your assessment looks wrong — for example, income is missing or doubled — you can object or request an amendment; the ATO can amend assessments for up to four years after lodgment.

Sources: Australian Taxation Office (ato.gov.au) — Your notice of assessment; Refunds; Paying your tax debt; Moneysmart (moneysmart.gov.au) — Lodging a tax return.

General information only. This page explains Australian income tax in plain English. It is not tax advice, and it cannot tell you what to claim or how much tax you owe. Always confirm the current rates, thresholds, and your own position on ato.gov.au before you act, or speak to a registered tax agent. Contact: hello [at] tapetoolhq.com.