Complaints about the Australian Taxation Office more than doubled last financial year. The independent watchdog that handles them is now under pressure of its own. The Inspector-General of Taxation and Taxation Ombudsman's Annual Report for 2025–26 shows 3,668 complaints received, up 128 per cent on the year before. It also shows the office met only three of its seven measurable performance targets. For taxpayers in a dispute with the ATO, those numbers affect how long they can expect to wait.

The headline numbers

According to the Tax Ombudsman's Annual Report 2025–26, the office received 3,668 complaints in the year to 30 June 2026. That was a 128 per cent increase on 2024–25.

The office also processed more work. It resolved 3,377 complaints, 61 per cent more than the previous year. It began 2,171 investigations and completed 1,891.

The profile of complainants is telling. The report says 80 per cent of complaints were lodged online and 65 per cent came from taxpayers without a representative. In other words, most people approaching the watchdog are dealing with the ATO on their own, without an agent or adviser.

The figures arrive as frustration with the ATO also shows up among professionals. A separate commercial survey, the first ATO Sentiment Report, found 87 per cent of accountants say the ATO has become "somewhat or significantly more aggressive" in enforcement and compliance. That survey measures accountants' perceptions, not complaint outcomes.

Three targets met out of seven

The surge put pressure on the office's own performance measures. The report shows it met only three of its seven measurable key performance indicators.

On timeliness, 46 per cent of complaints were finalised within 50 days, against a target of 60 per cent. Within 80 days, the figure was 74 per cent, below an 85 per cent target.

Customer satisfaction also fell short, though it improved. Sixty-one per cent of customers said they would use the service again. That was up from 58 per cent the year before but below the 65 per cent target.

Hypothetical example: Picture 100 complaints finalised during the year. If the office had met its 50-day target, 60 of them would have been closed within 50 days. At the reported rate of 46 per cent, only 46 were, a gap of 14 complaints.

At the 80-day mark, the target implies 85 of the 100 would be finalised, but the actual rate means 74 were. That is 11 short. For the people in that gap, a complaint could still be unresolved nearly three months after it was lodged.

The example uses round numbers to show the scale. It does not track real individual cases.

A speed puzzle in the report

The report also contains two different figures on speed, and they don't obviously match.

Early in the document, it says the average time taken to resolve investigations fell by 58 per cent. A later section says complaints were resolved 34 per cent faster.

The report does not explain how the two figures relate. They may measure different things, such as investigations against all complaints, or use different time frames. Either way, claims of faster handling sit alongside the missed 50-day and 80-day targets.

Reviews of the ATO, and whether it listened

Besides handling individual complaints, the office carries out broader reviews of how the ATO operates. Four reviews were completed in 2025–26, according to the report.

Their subjects were ATO letters (published 17 July 2025), the registered agent phone line (16 October 2025), the remission of general interest charge (2 March 2026) and one own-motion review that was not published (22 April 2026).

Across the reviews, the office made 33 recommendations. The ATO agreed to 32 of them, or 97 per cent.

Agreeing to a recommendation and putting it in place are different things, however. The report says 75 per cent of recommendations the ATO implemented were completed on time, short of a 90 per cent target.

That gap matters because a review's value depends on what changes afterwards. A recommendation the ATO accepts but implements late leaves taxpayers dealing with the old process for longer.

Some themes also overlap. General interest charge remission was the subject of a full review and also appears among the report's case studies, a sign that the same pressure points show up in both systemic reviews and individual complaints.

More money, and what complaints look like

The government has increased the office's funding by $9 million over four years, according to the report.

The report's case studies show the kinds of problems that reach the watchdog. One involved a refund sent to a Credit card that had since been cancelled. In another, a request to remit general interest charge was reconsidered after the taxpayer escalated it. A third involved a director penalty notice issued in error, which was later withdrawn.

These are everyday administrative problems, not technical disputes over tax law. They show the sort of issue many taxpayers might take to the office before considering formal objection or appeal rights.

The Tax Ombudsman handles complaints about the ATO's administrative actions and service. It does not decide your tax liability. If you are in a dispute over an assessment, the objection process and its time limits may also be relevant.

What to watch next

  • Complaint volumes in 2026–27: whether the 128 per cent jump was a one-off or the start of a sustained rise, especially after a busy tax time and the 2 November lodgment deadline.
  • Timeliness targets: whether the extra $9 million in funding lifts the share of complaints finalised within 50 and 80 days towards the 60 and 85 per cent targets.
  • ATO follow-through: whether the on-time implementation rate for recommendations moves closer to the 90 per cent target.
  • New reviews: further own-motion reviews and their published recommendations, which can point to systemic problems taxpayers are facing.

For now, the annual report shows a watchdog doing more work than ever while falling short of most of its own benchmarks. Complaints can take time.