Internal ATO Procedure For Processing Incorrect EFT Refunds.
ATO
AI summary
The ATO disclosed internal operational guidance on processing failed electronic funds transfer (EFT) refunds. The document outlines procedures for when refunds cannot be delivered due to incorrect bank account details provided by clients, keying errors by ATO staff, or account closures. For Individual and Complying Pension (ICP) refunds, cheques are issued within 10 days of funds being returned from the Reserve Bank or financial institution. The guidance directs staff to update client financial institution account details, verify refund status in the ICP system, and recall refunds if the effective date hasn't passed. It emphasizes directing clients to self-service options and relevant ATO web resources. The document reflects standard administrative procedures for managing refund delivery failures across tax return and Business Activity Statement contexts.
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FOI-2026-00413 E World Health Organization EKM Work types > Work Management Activities > ... > Processing refund requests > Incorrect EFT refunds # Incorrect EFT refunds I-2, B-5 - Provides information about why an EFT may fail. Last published 19 November 2025 Favourite Notes Collapse all # On this page Background Self Help In Detail # Background I-2, B-5 This page provides information about why an electronic funds transfer (EFT) may fail. A direct refund via EFT may fail if the: - client has given the ATO incorrect financial institution account (FIA) details - incorrect details have been keyed, or - refund was returned by the client's financial institution (e.g. the account may be closed). If a direct refund cannot be processed due to these reasons, for: - ICP refunds, a cheque will issue within 10 days of the funds being returned to the ATO from the Reserve bank of Australia (RBA) or the client's financial institution Page 1 of 6 FOI-2026-00413 - AIS/ICA refunds, go to Activity statement finalised - Where is my refund? (/fo/nn/023/activity-statement-finalised-where-is-my-refund#) ## Recent updates | 18/02/2025 | Updates under 'Client's EFT refund was paid into incorrect bank account'. | SD-90612 | | --- | --- | --- | ## Self Help ### ATO website ### Help the caller go to the page while on the phone. This is a chance to educate the caller about self-help options, which may lead to: - the client using self-service in the future, and - a better client experience. Clients can obtain more information from the ATO website on: - Missing tax return refunds (https://preview.pr.agov.prod.atohnet.gov.au/individuals-and-families/your-tax-return/check-the-progress-of-your-tax-return/missing-tax-return-refunds) - BAS refund - Incorrect or incomplete bank account details. (https://preview.pr.agov.prod.atohnet.gov.au/businesses-and-organisations/preparing-lodging-and-paying/business-activity-statements-bas/bas-and-gst-tips/bas-refund?page=2) Use our self-service any time - it's easy, free and fast. Refer to Self-help services. (https://preview.pr.agov.prod.atohnet.gov.au/about-ato/contact-us/self-help-services) In Detail FOI-2026-00413 # Client's EFT refund was paid into incorrect bank account If the refund was paid to an incorrect bank account because: the client mis-keyed their bank details or did not update the bank account or due to ATO error: - Update the client's FIA to the correct account to ensure future refunds are paid correctly: FIA – overview, eligibility and guidance. (/fo/nn/012/fia-overview-eligibility-and-guidance) - Check ICP to confirm whether the refund has been returned by the bank and action in accordance with the table below. - If the EFT refund effective date has not been reached the refund can be stopped and recalled, go to Recalls – recall an EFT disbursement or DDR. (/fo/nn/012/recalls-recall-an-eft-disbursement-or-ddr) | If the refund has... | Then... | | --- | --- | | returned and the account is in credit | advise the client: • the refund will be paid to their bank account within 10 days • they can monitor the progress of the refund via Online Services. | | returned and a cheque reissue posting is present | confirm the client's postal address is correct. If: • required update the address using Client details – address (/fo/fc/car/update-details/client-details-address) • the cheque was issued to the wrong address request a replacement, refer to Request for a replacement refund (via cheque or EFT). (/fo/fs/isc/work-management-activities/accounts/eft-and-invalid-credits/request-for-a-replacement-refund-via-cheque-or-eft-quicknav) If the cheque was delivered to the correct address, advise the client that: • the refund will be issued via cheque and allow 10 days for delivery • they can monitor the progress of the refund via Online Services. | | • not returned, and • issued within the last 10 | advise the client: • the incorrect refund should be returned by the bank and then reissued to their bank account within 10 days | FOI-2026-00413 | If the refund has... | Then... | | --- | --- | | days | • they can monitor the progress of the refund via Online Services. | | • not returned, and • issued more than 10 days ago and the account owner is known to the client. For example, their own previous bank account, current or former tax agent, current or former partner or family member. | advise the client: • this is considered a civil matter and the refund will not be retrieved by the ATO • the client should contact to the owner of the bank account to obtain their refund • if the bank account is owned by the client, but closed, they should contact the bank regarding their refund • to refer to Missing tax return refunds on the ATO website. | | • not returned • issued more than 10 days and the account owner is unknown. For example, client miskeyed their bank account details. | escalate the activity (/managing-wma-and-cases-in-siebel/classify-or-reclassify/reclassify-and-reallocate-an-activity) using the values: • **Capability**: Operations • **Category**: Accounting • **Type**: Incorrect EFT • **Template**: Incorrect EFT. Refer to Update activity - attach template or checklist (/managing-wma-and-cases-in-siebel/siebel-activities/update-activity-attach-template-or-checklist) • **Note**: include if due to an ATO operative/system error • **Status**: UnAllocated • **Assigned To**: ENTERPRISE_Q. Advise the client: • the processing timeframe is dependent on when information is received from third parties such as banks. For this reason, the timeframe may be longer than 28 days • if the incorrect refund is due to the client's error, the ATO cannot guarantee the client will be reimbursed. | Page 4 of 6 FOI-2026-00413 # Tax agent or taxpayer calling because they incorrectly received someone else's refund Registered tax agents may receive refunds incorrectly paid into their trust bank accounts from former clients who have failed to update their bank account details. Taxpayers may receive refunds incorrectly paid into their bank account when another person mis-keys their bank details which happen to match the taxpayer's. ## Action required: Ask the tax agent or taxpayer to return the payment to the ATO using the following details: - BSB: 092 009 - Account number: 118 443 - Account name: ICP EFT RTNS LRF - Reference: Lodgment Reference Field (LRF) number received with the refund. **Record the conversation:** Ensure you create activities on both, the refund owner's account, and the caller's account, to minimise investigation when the amount is repaid. This will ensure Accounting does not take action to recover the refund from the caller. Add a Siebel note (/fo/fc/sri/case-management/quality-notes) on the caller's account advising that the refund was sent to an incorrect bank account and is being returned to the ATO by EFT. The note will ensure Accounting does not take action to recover the refund. ## Locate the owner of the refund: - Obtain the refund LRF number from the caller - Open ICP - Select Disbursement search on the left-hand side - Select Lodgment reference field - Enter the refund LRF and select search - This will locate the owner of the refund (do not share this information with unauthorised clients) - Search the TFN in Siebel and create a new activity with the following classifications: Page 5 of 6 FOI-2026-00413 - **Capability**: Operations - **Category**: Accounting - **Type**: Incorrect EFT **Note**: Include: ‘A third party has called advising they incorrectly received this client’s refund, reference: <lodgment activity:="" been="" before="" by="" call="" carrier="" carrier:="" been="" before="" before:="" call="" been advised="" by="" call.="" defer="" deference="" refer="" reference="" refund.="" reference:="" refund.="" reference:="" to="" when="" where="" “managing-wma-and-cases-in-siebel="" ”="">.’ - Link this activity to the caller’s inbound phone activity via service request (/managing-wma-and-cases-in-siebel/service-requests/create-a-service-request-in-siebel) - Close the Incorrect EFT activity - Finalise your inbound call activity. ## Progress of EFT refund reject and fail Where a refund has been rejected due to a technical issue that may have prevented the account being credited, advise the client to contact their financial institution. If the client has called back because the bank could not locate the refund, the destination of the funds transfer needs to be traced. Check the Progress of an EFT refund rejection or failure. (/fo/fs/isc/work-management-activities/accounts/eft-and-invalid-credits/progress-of-eft-refund-rejection-or-failure) Rate this page Send feedback</lodgment>