You lodged your tax return, you have been checking the ATO app every morning, and the status has changed to “Accounting action in progress”. It sounds ominous. It is not. It is the last routine step before your notice of assessment issues, and for most people it lasts a few days.
This guide explains what the ATO is actually doing at this stage, how it lines up with the status names the ATO publishes for individuals (“In progress – Balancing account” and the others), how long it normally takes for 2025-26 returns, what can hold it up, when your refund can be redirected to pay a debt, and when the ATO owes you interest. It is checked against the ATO’s status of your tax return page and its interest and refund-offset guidance.
If you are mainly interested in the overall timeline, read this with our guide to how long a tax refund takes in Australia. If your status has been sitting at this stage for weeks, the sections on delays and offsets below are the ones to read first.
Key takeaways
- It is the final reconciliation step, not a review or audit. Your return has been assessed; the ATO is balancing the result against your ATO account and other government agencies.
- In ATO online services for individuals the same stage appears as “In progress – Balancing account”. “Accounting action in progress” is the wording used in agent-facing and older ATO screens.
- Normal timing is days, inside the ATO’s 12-business-day processing window for online lodgments. Manual processing, where needed, takes up to 30 calendar days.
- Your refund can be used to pay debts – ATO debts, Centrelink and other Services Australia debts, and child support – and you will be told afterwards.
- If the ATO takes 30 days or more after lodgment to issue a refund assessment, it pays interest on the overpayment, which is assessable income.
- Stuck beyond two weeks? Check your bank details and myGov inbox, then ask your tax agent to follow up through Online services for agents.
ATO return statuses at a glance
| Status you may see | What the ATO says it means | What to do |
|---|---|---|
| In progress – Processing | Return received and processing has started; later, the return is nearly finalised and an estimated assessment date is shown | Nothing – wait |
| In progress – Information pending | The ATO is collecting information to finish processing and will contact you if it needs more | Watch your myGov inbox |
| In progress – Under review | The ATO is manually reviewing the return before finalising it | Respond promptly if contacted – see our guide to an ATO review of your return |
| In progress – Balancing account (“Accounting action in progress”) | The ATO is balancing the result with your ATO accounts and other Australian Government agencies, which may involve transferring funds if you have outstanding amounts | Nothing unless it runs past two weeks |
| Issued – $ amount / Nil | Processing is complete and the notice of assessment has issued | Check the notice; refunds go to your nominated bank account |
Source: ATO, Status of your tax return (last updated 17 August 2026). Checked 7 October 2026.
What is the ATO doing during “accounting action in progress”?
By the time you see this status, the ATO has already worked out your taxable income, your tax, your offsets and your Medicare levy. What remains is accounting, in the literal sense: posting the result to your income tax account and checking whether anything else needs to be settled before money moves. The ATO’s published description of the equivalent individual status is that it is “balancing the result of your tax return with your accounts with us and other Australian Government agencies. This may involve transferring funds if you have outstanding amounts.”
In practice the system is checking, in roughly this order:
- Your ATO account. Any outstanding income tax, activity statement or other ATO debt, including debts previously put on hold, is offset against the refund first.
- Other Australian Government agencies. The ATO says it is required to pay part or all of your refund to agencies such as Services Australia (Centrelink) and Child Support if there are outstanding amounts.
- Interest. If the refund is late, interest on overpayments is calculated and added.
- Payment details. The refund is prepared for the Australian bank account you nominated in the return.
Once those steps are complete the status flips to “Issued”, the notice of assessment lands in your myGov inbox, and the refund is paid. If an amount was offset, the notice of assessment shows the reduced refund and the agency that received the money writes to you separately.
Why two different labels?
The ATO’s online services for individuals use the plain-English statuses in the table above. “Accounting action in progress” is the wording that appears in agent-facing and older ATO screens for the same reconciliation stage, which is why you will see both phrases used online. They describe the same step. Neither one indicates a problem with your return.
How long does it take?
The ATO’s benchmark is that most tax returns lodged online are processed within 12 business days from lodgment to notice of assessment. The balancing step sits at the end of that window and usually takes a few days. Paper returns take considerably longer, and anything that needs manual handling “generally takes up to 30 calendar days”, in the ATO’s words, and cannot be sped up by phoning.
The ATO lists the main reasons a return takes longer than 12 business days. Several of them show up at exactly this stage:
- you have a tax debt, or a previously unresolved or re-raised tax debt, with the ATO;
- the ATO needs to check information with other government agencies such as Services Australia, including Centrelink or Child Support, because part or all of your refund has to be paid to them;
- the bank account details in your return are not current;
- you lodged returns for several years at once, or lodged an amendment before the original finished processing;
- you attempted to lodge the same return twice;
- you are under an insolvency arrangement such as bankruptcy or a debt agreement.
The ATO also notes that a return can briefly show as a cancelled transaction on your income tax account for 24 to 48 hours while it is checked against information reported to the ATO. That is not a sign the return has stopped processing, and the ATO asks you not to lodge again; allow up to two weeks for an electronically lodged return to be finalised.
Can the ATO use my refund to pay a debt?
Yes, and this is the most common reason the balancing stage produces a surprise. The ATO offsets any amount you owe it, and it is required to pay refunds to other Australian Government agencies where you have outstanding amounts with them. Services Australia puts it plainly on its debt recovery at tax time page: it may use your tax refund to reduce the amount you owe “even if you have a repayment arrangement in place”, it can use a refund to pay outstanding child or spousal support, and it will send you a letter afterwards to explain. Recovery can be paused where repayments have been suspended because of a disaster or a pending formal review.
| Debt type | What happens at the balancing stage | Who tells you |
|---|---|---|
| Tax debt with the ATO (including debts previously on hold) | Refund is applied to the debt first | Your notice of assessment and ATO account |
| Centrelink or other Services Australia debt | Refund (or part of it) is transferred to Services Australia | Letter from Services Australia after the transfer |
| Child support arrears | Refund is used to pay outstanding child or spousal support | Letter from Services Australia (Child Support) |
| No debts | Full refund paid to your nominated bank account | Notice of assessment |
You cannot stop a lawful offset by lodging later or by changing bank accounts, and trying to do so delays everything. If you think an offset is wrong – for example the debt has already been paid or is under review – contact the agency that holds the debt, not the ATO. The ATO’s notice of assessment page explains how to read the offset lines on your assessment.
Does the ATO pay interest if my refund is late?
It can. Under the ATO’s interest on overpayments rules, interest is payable where the ATO takes 30 days or more after you lodge your tax return to issue a notice of assessment that results in a refund, with the 30 days counted from the date the ATO receives all the required information. The interest is calculated automatically and paid into your nominated account with the refund, or offset against any debt. It is assessable income: the ATO says to include it in your return for the year you receive it, or the year it is offset against another tax debt.
In practice this only applies to returns that have genuinely stalled at the ATO’s end. If the delay is because your bank details were wrong or you lodged twice, do not expect interest.
Rule of thumb
Days at “accounting action in progress”: normal. Two weeks with no change: check your bank details and myGov inbox, and look for a letter from Services Australia. Beyond 30 days from lodgment: ask your tax agent to follow up through Online services for agents, and note that interest on the overpayment should be added if the delay was the ATO’s.
Worked examples
Jaspreet – Centrelink debt offset. Jaspreet lodges on 10 July 2026 expecting a $2,000 refund. The status sits at “Accounting action in progress” for six days while the ATO checks with Services Australia, which has a $900 debt recorded against him from a Youth Allowance overpayment. The ATO transfers $900 to Services Australia and pays $1,100 to his account. His notice of assessment shows the $2,000 assessment and the offset; Services Australia writes to him separately.
Ajay – old tax debt. Ajay lodges three years of overdue returns at once. The 2025-26 return produces a $1,400 refund, but his 2023-24 return produced a $1,900 debt. At the balancing stage the refund is applied to the older debt, his notice of assessment shows a nil refund, and his ATO account shows a remaining balance of $500 to pay.
Mei – wrong BSB. Mei mistyped her BSB. Her return reaches the balancing stage on day eight and stays there because the refund cannot be paid. She updates her bank details in ATO online services and the refund issues three business days later. No interest is payable because the delay was not the ATO’s.
What to do if the status will not change
- Check your bank details in ATO online services through myGov. Out-of-date BSB or account numbers are the single most common cause of a stuck refund.
- Read your myGov inbox. If the ATO needs information it writes there first, and the status would normally change to “Information pending” or “Under review”.
- Check for letters from Services Australia or Child Support explaining an offset.
- Do not lodge again. A second lodgment is one of the ATO’s listed causes of delay.
- Ask your tax agent to follow up. Agents can see processing detail and lodge a progress enquiry through Online services for agents, which is faster than the general phone line. If you lodge yourself, the ATO’s contact page lists the individuals line and the self-help options.
- Financial hardship? The ATO offers priority processing for people experiencing serious hardship – ask for it rather than waiting.
Common misunderstandings
- “It means I am being audited.” No. Reviews show as “Under review” or “Information pending” and come with contact from the ATO.
- “My refund amount has changed, so the ATO made a mistake.” More often a debt was offset. Check the notice of assessment and any agency letters before disputing.
- “Calling the ATO will speed it up.” The ATO says manual processing cannot be sped up by phoning. Fix the cause (bank details, duplicate lodgment) instead.
- “I should lodge again to reset it.” That creates a duplicate and adds weeks.
- “The interest the ATO paid me is tax-free.” Interest on overpayments is assessable income in the year you receive it.
FAQ about accounting action in progress
What does “accounting action in progress” mean on my tax return?
It means the ATO has finished assessing your return and is now reconciling the result against your ATO account and any amounts you owe other government agencies before it issues your notice of assessment. In the ATO’s own online services for individuals the same stage is labelled “In progress – Balancing account”, which the ATO describes as balancing the result of your tax return with your accounts with the ATO and other Australian Government agencies. It is not a review or an audit.
How long does accounting action in progress take?
Usually a few days. The ATO says most returns lodged online are processed within 12 business days in total, and the balancing stage is the final part of that window. If your refund has to be offset against an ATO debt, a Centrelink debt or child support, or your bank details are out of date, it can take longer. Manual processing, where it is needed, generally takes up to 30 calendar days.
Can the ATO take my refund to pay a debt?
Yes. The ATO says it is required to pay part or all of your tax refund to other Australian Government agencies, such as Services Australia (including Centrelink) and Child Support, if there are outstanding amounts, and it will offset any tax debt you have with the ATO itself. Services Australia says it may use your refund to reduce a debt even if you have a repayment arrangement in place, and will write to you afterwards. Your notice of assessment shows the result, and the agency involved sends its own letter.
Will I get interest if the ATO is slow to pay my refund?
Possibly. The ATO pays interest on overpayments if it takes 30 days or more after you lodge to issue a notice of assessment that results in a refund, counted from the date it has all the required information. The interest is calculated automatically, paid with the refund (or offset against a debt), and is assessable income in the year you receive it.
Does accounting action in progress mean I am being audited?
No. A review or audit shows up differently: the ATO status would read “In progress – Under review” or “Information pending”, and the ATO would contact you or your tax agent for information. Accounting action is the routine reconciliation step that every return passes through before the assessment issues.
Talk to specialist before it costs you
15-minute discovery call. No obligation, no jargon.
Talk to a registered tax agent
If your return has been sitting at the balancing stage for more than two weeks, or your refund came back smaller than you expected and the notice of assessment does not make sense, we can look at the account detail and follow up with the ATO for you. Nanak Accountants prepares and lodges individual tax returns for clients across Australia and runs a tax education hub for plain-English guides like this one. Call 1300 626 258 or book a consultation.
This article is general information only and is not personal tax advice. Status definitions, processing times, refund-offset rules and interest on overpayments were checked against ATO and Services Australia pages on 7 October 2026.
