NOA (Notice of Assessment): Using Tax Documents for Mortgage Approval

A Notice of Assessment (NOA) is the ATO’s formal acknowledgment of your tax return. It shows your taxable income, tax paid, and any refund. For self-employed borrowers, the NOA is often the primary income evidence a lender will accept.

The lender needs to see your NOA because they want to confirm that the income you’re claiming has been declared to the ATO. If you claim $150,000 income on a mortgage application but only declared $120,000 on your tax return, the NOA reveals the discrepancy, and your application is at risk.

Lenders typically request two years of NOAs. This allows them to assess income trends (is your business growing, stable, or declining?). If your NOA from two years ago shows $100,000 income and last year’s shows $140,000, that’s a positive trend. If last year’s shows $100,000, that suggests a declining business and raises serviceability concerns.

The NOA must be recent. Most lenders want NOAs dated within the past 12 months. If you’re applying for a mortgage in March 2026 but your most recent NOA is from June 2024, lenders will want more recent income evidence (e.g., an accountant’s letter or draft tax return) because 18+ months is too old to reflect your current financial position.

Income-splitting or discretionary trusts can complicate NOA assessment. If you operate through a trust and you’ve elected to split income among beneficiaries, your personal NOA might show a lower figure than the trust’s total income. Lenders are cautious about income-splitting structures; some won’t lend to trust beneficiaries if the beneficiary’s personal NOA is low, regardless of the trust’s overall income.

Negative income (losses) on your NOA reduces your assessed income. If you’ve had a business loss in the current year (e.g., $50,000 revenue minus $60,000 expenses = -$10,000 loss), some lenders won’t count any income from that business for the upcoming year. Other lenders will average your income over the past two years (e.g., $120,000 two years ago minus $10,000 this year = average $55,000), reducing your serviceability.

Capital gains shown on your NOA are sometimes included in income for serviceability, sometimes excluded. A capital gain from selling an investment property is non-recurring income; lenders don’t usually count it toward future earning capacity. A capital gain from selling investment shares is similar. However, if you’re a business that regularly realizes gains (e.g., property developer, share trader), the capital gains might be counted as business income.

Non-resident tax status affects NOA interpretation. If you’ve been offshore or have non-resident tax status, your NOA might not reflect your full earning capacity in Australia. Lenders will ask for explanations; returning residents sometimes face additional scrutiny.

Amendments and further assessments complicate things. If the ATO has issued a Notice of Further Assessment (NOFA) after you received your initial NOA, the NOFA supersedes the original. Lenders will want the most recent assessment document. If there’s ongoing dispute with the ATO (e.g., a tax audit), lenders often pause the application until the issue is resolved.

The ATO publishes NOAs online via the ATO portal. You can access your NOA, download it, and provide copies to lenders. Alternatively, you can authorise the lender to request the NOA directly from the ATO, which is more time-consuming but provides an official copy that lenders trust.

Disclaimer: This article provides general information only and should not be taken as financial or legal advice. Income verification, NOA assessment, and tax implications vary by lender and circumstance. Consult your accountant and mortgage broker before applying.