A $1 billion plan to outsource Australia’s visa processing system could be derailed by crossbench senators after the Department of Home Affairs warned the changes would likely need to be legislated.

The official advice throws into doubt the future of the project to build and manage a new online system to process and provide visas for more than 9 million applicants a year.

The Department of Home Affairs is determining the successful bidder for a project to manage a new online system to process visas.

The department's incoming government brief to Home Affairs Minister Peter Dutton, released under Freedom Of Information Laws, says the plan “will likely require new supporting legislation”.

The contentious proposal could be dead on arrival with Labor, the Greens and Centre Alliance all vowing to vote against the move in the Senate.