Company tax return review checklist for Australian accountants

How to use the checklist

For each relevant area, record the source, reviewer, date and outcome. Use a clear status such as reviewed, query open, escalated or not applicable. A tick without a basis is not a substitute for assessment.

The TPB explains that reasonable care depends on the circumstances; it is not a fixed checklist or a universal duty to audit all client information. Apparently inconsistent or unreliable information may require further enquiries. (R1)

1. Confirm the entity and final file

• Confirm the company name, identifiers, income year and relevant return version.
• Check the public officer and other relevant details against current authorised records.
• Identify changes to ownership, control, residency, activities or group membership that need technical consideration.
• Confirm final accounts, the tax reconciliation and material supporting schedules are present.
• Mark superseded documents so the reviewer is not comparing different preparation stages.

A company that looks unchanged in the accounting software may have undergone an ownership or business change relevant to the tax review. Record the change and refer it for assessment rather than rolling last year's treatment forward automatically.

2. Reconcile accounts to taxable income

• Trace the accounting profit used in the tax reconciliation to the final financial statements.
• Review each material adjustment and identify its supporting workpaper or explanation.
• Separate accounting and tax treatments rather than assuming an expense label establishes deductibility.
• Check the arithmetic and trace the final taxable income to the return.
• Reconcile the tax calculation, offsets, credits and payments through the relevant workpapers; distinguish tax expense from the amount payable.

Use the tax reconciliation review checklist for a deeper review of this bridge.

3. Assess income and material expenses

• Reconcile material income streams to the underlying records and investigate unexplained omissions or duplication.
• Review unusual receipts, year-end journals and significant reversals.
• Identify capital, private, timing and non-deductible components where relevant.
• Check substantiation and any year-specific conditions for significant deductions.
• Investigate unusual movements rather than treating a prior-year comparison as a conclusion.

The aim is not to reject every unusual transaction. It is to understand what happened and whether the reported treatment has an adequate basis.

4. Review related-party balances and Division 7A workpapers

• Trace relevant loan and related-party balances between the accounts, ledger, schedules and return disclosures.
• Distinguish balances, transactions and counterparties rather than relying on a generic "director loan" label.
• Locate relevant agreements, movement schedules, repayment records and practitioner calculations.
• Confirm the practitioner has assessed the applicable rules, timing and any proposed action.
• Update affected disclosures after resolving a review point.

Use the Division 7A review checklist. Taxpartna does not calculate minimum yearly repayments; its review of submitted documentation does not establish Division 7A compliance.

5. Check company tax-rate support and franking

• Document the basis for the applicable company tax rate using the rules for the relevant year.
• Review the turnover and income inputs required for any base-rate-entity assessment.
• Keep the company income-tax-rate analysis distinguishable from any separate corporate tax rate for imputation purposes analysis.
• Reconcile relevant dividend decisions, payment records, statements and franking workpapers.
• Review opening balances, movements and closing positions, and determine whether additional returns or liabilities need attention.

The base-rate-entity guide and franking account guide provide focused review questions. Do not assume a prior-year tax rate or franking treatment remains appropriate.

6. Review losses, assets and specialist matters

• Reconcile carried-forward tax losses and capital losses separately to prior-year records.
• Assess eligibility to use losses; agreement of balances alone is not sufficient.
• Review asset acquisitions and disposals against contracts and supporting schedules.
• Check the basis of material depreciation, capital allowance and CGT calculations.
• Identify matters requiring specialist review, such as consolidation, international dealings, R&D claims, restructuring or personal services income.

Record where a specialist conclusion is required and who owns it. This checklist is not a substitute for the specialist analysis.

7. Check disclosures and close the review

• Check applicable schedules, elections and disclosures against the current-year instructions.
• Confirm material changes flow through every affected return and workpaper.
• Track open queries to evidence-backed resolution or clear escalation.
• Retain required client instructions, approvals and declarations through the firm's process.
• Record the final reviewer conclusion and the registered practitioner's sign-off decision.

Example: a late journal changes more than one schedule

Fictional example. The preparer posts a final interest adjustment. The financial statements change, but the tax reconciliation and a related-party schedule remain on their previous versions.

A useful review note identifies each affected document, asks whether the adjustment has been incorporated, and records the final agreed treatment. It does not simply say "journal posted, therefore reviewed".

What should remain on the file?

Keep an understandable account of material issues, enquiries, evidence and outcomes. The TPB's record-keeping guidance addresses the service provided, information considered and, for more complex advice, the supporting facts, assumptions and reasoning. (R2)

The tax review file note checklist provides a practical recording structure.

Where Taxpartna fits

Taxpartna's company tax return review software can support the review of submitted files within its available checks. The checklist above remains the firm's wider professional process, not a promise of automated coverage.

Sources

• R1: Tax Practitioners Board: Reasonable care
• R2: Tax Practitioners Board: TPB(GS) 52/2024 Obligation to keep proper client records

General information only. Use the relevant income-year instructions and obtain specialist advice where needed. The practitioner retains responsibility for calculations, conclusions and final sign-off.