We all do the right thing and pay our fair share of tax don’t we? Unfortunately, not everyone feels that they should. The latest ATO blitz is focused on flushing out businesses who operate in a cash only or ‘hidden economy’. And given the advances in technology, the ATO has more resources than ever to data match and identify areas of ‘concern’- and they are out and about visiting high risk businesses.
Some key factors that may trigger a ‘visit’ are:
- Not having a separate business bank account
- Not having EFTPOS or an electronic payment option for your customers
- Not recording sales or keeping proper records
- Advertising as a cash only business
- Not being registered for GST (if required)
- Not lodging tax returns and activity statements on time
- Your lifestyle expenses exceeding your reported income
The ATO also has a confidential information line where people are able to report a concern about potential tax evasion – and information from this service may also prompt some further investigation.
If the ATO has found that a business has deliberately tried to avoid paying tax then it could result in an audit, penalties or even prosecution.
If you’ve accidentally made a mistake or have forgotten to report some income, please contact our office so that we can assist in rectifying the matter. The ATO have indicated that making a voluntary disclosure may mean a reduction in any penalties or interest charges that they may levy.
We know that our clients do the right thing – but if you know of anyone who might not, feel free to forward them this article.
For further information, click here.