ATO warns of audits and potential fines

The Australian Tax Office (ATO) has issued a warning that it will be scrutinising every tax return lodged in the previous year using a sophisticated cross-checking system to identify inaccurate or fraudulent claims. Anyone known to have knowingly dodged their tax obligations may be subject to an audit or big fine.

Karen Foat, Assistant tax commissioner told ABC News, “We know that some people think it’s okay to overclaim their deductions even by just a little. But our message is – that’s not okay. A lot of people overclaiming by just a small amount adds up to $8.7 billion less each year for essential services and we can’t turn a blind eye to that.

“Some people fess us straight away but some people continue the lie. But it’s just better to be honest with us even if you’ve done the wrong thing; it will be a much less painful experience.”

The ATO contacts around 2 million taxpayers each year regarding their returns including both deliberate tax cheats and those who have made an innocent mistake.

Claims which have raised the alarm with the ATO include uniforms in an unlikely work environment, the inappropriate use of a private vehicle for work and fake work records and receipts. Underreported income, deductions that seem high compared to others in a similar job and income level will also raise concerns.

Any small business or individual tax payer who is contacted by the ATO for an audit should urgently seek the advice and assistance of an accountant.

Visit your local TaxAssist Accountants for help and advice with any of the above.

Date published 5 Dec 2019 | Last updated 5 Dec 2019