Tax garnishees to recover debts 107-05050040

If contact is made:

• by a customer to discuss a garnishee of their tax refund, go to Step 2
• by the Australian Taxation Office (ATO), go to Step 4
• and there is a potential mismatch, go to Step 9
• which may involve a manual wash up transaction, go to Step 10
• by a tax agent, see Tax agents authority to enquire on behalf of customers

Determine if the funds were from a tax garnishee or from offsetting through the family assistance reconciliation process. From Customer First Workspace menu, select ATO garnishee summary.

Is there a Transaction Type Garnisheed Amount under the Garnishee Transaction Summary heading on the ATO Garnishee Summary page?

• Yes, the customer's tax refund was 'garnisheed':
• for smart centre and service centre staff, if the customer would like to discuss it further, transfer the customer to Debt Recovery. Procedure ends here
• for Debt Staff, go to Step 3
• No, the customer was not subject to a tax garnishee but offsetting may have occurred. See Debt offsetting during family assistance reassessment, reconciliation and claim processing

Procedure ends here.

The automated tax garnishee process meets all legislative requirements under the Social Security Act, Family Assistance Administration Act, Paid Parental Leave Act and Student Assistance Act.

It is not a legislative requirement for a customer to be warned about or issued a garnishee warning notice prior to one being implemented. However, legislation requires the department to provide a copy of the garnishee notice to the debtor.

The Debt Management and Information System (DMIS) will automatically check the customer record when the ATO notifies the agency that a customer has lodged their tax return or activity statement. The ATO provides the customer's latest address (from the tax return) as part of this process.

DMIS will:

• automatically check if there is still an eligible debt/s for garnishee
• update the customer's record to reflect whether or not a tax garnishee is in place
• trigger a Batch Laser Advice (BLA) garnishee notice to the customer (sent to the address provided by the ATO unless no address is provided). Note: the History Summary (HS) screen will display Tax Garnishee notice (DMNNOT) has been sent. In the situation of multi-liability co-debtors, a letter is sent to each customer but both letters display on the Garnishee Summary of the primary debtor
• notify the ATO of the amount the garnishee seeks to recover

The ATO will:

• apply the garnishee to the tax refund. The garnishee amount is the lesser of the refund available for garnishee or the debt amount owed to the agency
• advise the agency of the garnishee amount which is then automatically recorded in DMIS and ESSentials
• append a statement of account to the Notice of Assessment (NOA) sent to the taxpayer. This will show 'Credit offset to Centrelink' with the appropriate amount

To check the amount that was garnisheed, in Customer First, select Debts > ATO Garnishee Summary.

The ATO Garnishee Summary page displays information about the tax garnishee process.

Under the Garnishee Transaction Summary heading, select the Transaction ID hyperlink relating to the Garnisheed Amount transaction type.

The Garnishee Transaction Details page will display the Garnishee Amount under the Garnisheed Amount Received heading.

Note: tax garnishee repayment amount/s will also display on the Overpayment Repayment History (OPRH) screen. They display as ATO Auto Garnishee (TRG) payment. The repayment date displaying on OPRH and Debt Summary (in Customer First) is the transaction date when the agency sent the request to the ATO. The date may be different to the Garnisheed Amount Received date displaying in Customer First. This accommodates ESSentials reconciliation which needs to align with ATO transaction dates.

If the customer requests a review of the garnishee decision, see Garnishee customer does not agree with decision

Procedure ends here.

Use the Debt Recovery script when actioning a debt.

Has the ATO contacted to advise a tax refund is due to the customer?

• Yes, go to Step 5
• No, go to Step 9

In certain circumstances the ATO may perform a tax assessment manually. The manual process records the recovery of monies from the taxpayer's refund to repay a Centrelink debt/s. The ATO will email requests to the Garnishee Liaison Officer.

The email states ‘Garnishee amount-please advise the amount required for the following Garnishee’. It also includes the following text:

• Attention: Debt Program
• Please advise the Garnishee amount required for the following client:
• Customer Reference Number (CRN)
• Full name (and title) of client
• Type of return (BAS credit, ITR credit or misc credit)
• Financial year
• Please send response to the Centrelink garnishee mismatch mailbox

Note: only Debt Staff at the APS5 level or above with appropriate delegation can process a manual garnishee request.

Has an ATO email request for a manual Tax Garnishee been received?

• Yes, go to Step 6
• No, go to Step 9

Note: if there are Family Tax Benefit (FTB) debts, allow 24 hours before proceeding to ensure FTB reconciliation has finalised.

In Customer First:

• key the CRN in the CRN field. Contact the ATO for identification details if a CRN is not provided and the customers identity is unknown
• verify customer name on Customer First is the same as in the email
• check the Debt List (OPDL) screen to ensure a recoverable debt is outstanding. If:
• there is no recoverable debt, go to Step 8
• a recoverable debt exists, go to Step 7

Go to the Debts tab in the left hand menu and select:

• ATO garnishee manual request
• Type of Return (as per the ATO email request, for example, ITR credit)
• an option in the Financial Year dropdown box (as per the ATO email request, for example, 2011)
• Submit Manual Garnishee to ATO, this will process the garnishee request and generate a Transaction ID

Reply to the ATO email

This includes if the result is a zero amount.

Reply using the Reply to All option:

• address email to ATO Manual Garnishee
• copy and paste the details of the Garnishee Request box into the email response and send

Garnishee Transaction Summary screen

Select the ATO Garnishee Summary tab to view the details of the Garnishee Transaction Summary screen.

Select Debts > ATO Garnishee.

Go to the ATO email and Reply to All to advise that 'no garnishee action' is required.

Procedure ends here.

The ATO may be unable to match 2 customer records when Services Australia refers customer data. This is known as a 'mismatch'.

Customers may claim that incorrect tax deduction has occurred. Verify this with the ATO to determine the client of interest (COI).

The ATO may advise a COI mismatch in the following cases:

• Client not found
• Client has another CRN
• CRN exists for another client
• CRN is end dated

The Payments and Integrity Operations Strategy team will obtain a regular report to monitor the COI mismatch errors. The report will also determine the appropriate follow-up action in these cases.

Customers may contact about missing or incorrect tax garnishees. These investigations are completed by an APS5 or above.

Is there a suspected mismatch?

• Yes, DOC the conversation with the customer. Include relevant details to assist the investigation. Refer the case to the ATO Garnishee Liaison Officer. Include in the email:
• Subject line: 'INCORRECT TAX GARNISHEE'
• Customer's full name, date of birth, address, phone number and their CRN
• Original garnishee amount
• Amount to be reversed
• Processed date
• Effective date of the offset transaction
• Reason for reversal
• Other useful information includes the Notice of Assessment (NOA) number and amount of the payment in question
• Procedure ends here
• No, a manual wash up may be required. Go to Step 10

The ATO may garnishee a COI but the transaction does not flow to the agency. Contact the ATO for:

• the transaction ID number
• date refund processed
• garnishee amount

Debt Staff need the ISP resource 'DMISDW-DMIS DATA WASH' to be able to process a manual wash up.

Go to the ATO Manual Wash up screen.

From the information provided by the ATO:

• key in the:
• Transaction ID number
• ATO Processed Date
• Amount
• select the Generate Transaction tab

The Manual Wash up screen will show a confirmation message:

'A transaction has been created with the following details. The customer's debt balance will update in approximately 1 hour.

The Transaction Details will display with the data put into the system.

If the mismatch notification has been received from the:

• ATO, go to Step 2
• customer, email ATO with the details of the suspected mismatch

If the ATO confirms the mismatch:

• Yes. To process the reversal or adjustment of the ATO garnishee or tax refund in:
• Process Direct, go to Step 3
• Customer First, go to Step 4
• No:
• DOC record that no ATO mismatch has been identified
• procedure ends here

To process the ATO reversal in Process Direct:

• identify the customer in Customer Summary
• select the Debt icon to launch Debt Management
• on the Debt List, select the Repayments icon to view the:
• repayment source
• allocated amount
• over recovered amount
• refunded amount, and
• reversed amount

Select:

• Repayment Details icon on the repayment line
• to refund to ATO (TAA)
• Repaid Components displays. Outstanding DMIS debts balance will display before refund
• Basic Details. From the Refund methods drop down menu, select TAA - refund to ATO
• the Document Name field must be keyed. Add any extra information in the Description field

Add notes in these fields:

• Summary, key the withholding details
• Content, add extra details

To complete the update, select:

• Submit to display the Confirmation screen
• Yes to complete refund to ATO

Go to Step 5.

To process the ATO reversal in Customer First:

• go to the Debt List (OPDL) screen and 'S'elect the debt
• go to Repayment History (OPRH) screen
• ‘S’elect repayment line to reverse or adjust
• Correct Amt, key the amount to be applied to the debt (reversal of full garnishee or tax refund amount will be 0.00)
• Refund Method, use:
• ADJ, for FAO reconciliation or ATO tax garnishee before 30 June 2009, or
• TAA, for ATO garnishee after 30 June 2009
• Reason Changed, key the reason for the change
• Continue to complete activity

Go to Step 5.

DOC must include the:

• Debt ID
• reason the funds were refunded back to the ATO
• adjusted amount of ATO garnishee or tax refund
• revised debt balance amount

Email the ATO to advise that the funds have been reversed with screen shot(s) of the reversal in the email.