ATO Targeting GST Compliance

by Ian Morella, Director of Accounting

Over the next four years, the ATO are going to look closely at GST compliance, with a dedicated program to deal with specific compliance issues and breaches. They will focus on:

  • The timely lodgment of activity statements
  • Verifying GST refund claims
  • Identifying and dealing with those that deliberately avoid GST
  • Addressing aging GST debts and those who deliberately use debt as away of avoiding their tax obligations

The ATO continue to expand their ability to identify non-lodgers and detect businesses that over-claim entitlements, deliberately under-report or omit income and use cash transactions to hide income.

How will the ATO target compliance breaches?

  • Using a combination of pre due date SMS and letter reminders around lodgment
  • Contacting taxpayers who have one or two activity statements overdue
  • Increasing their focus on taxpayers who have multiple activity statement obligations outstanding – this includes telephone based lodgment enforcement, default assessment and in some cases, prosecution action
  • Matching sales and high value transactions to activity statements and using information on asset transactions (particularly in the property industry) from state revenue offices, land titles offices and share registries
  • Verifying refunds by phoning or visiting businesses and contacting third parties to substantiate claims
  • Taking firm action with those businesses that don’t work with the ATO or meet agreed debt arrangements
  • Comparing businesses to small business benchmarks for their industry to select for audit – businesses that do not report within their range may not be recording or paying tax on all their transactions, especially cash transactions
  • Using benchmarks to calculate default assessments where a business provides insufficient or unreliable information or has not met their lodgment requirements;

The ATO warns for those “choosing to disregard the law and work outside the tax system” there will be serious consequences including interest, penalties and potential prosecution.

Identifying GST Evaders

The ATO will audit, and where appropriate prosecute taxpayers who:

  • Deliberately do not register for GST when they need to
  • Intentionally do not report, or consistently under-report their tax obligations
  • Collude with others to evade or avoid tax obligations
  • Try to obtain a refund to which they are not entitled

Ensuring you abide by the ATO’s rules and regulations is essential for a successful and compliant business.

If you would like information or advice on your GST obligations, whether you are a sole trader or a larger organisation, please call our Client Liaison Officer on 1300 726 082 who can arrange an appointment for you with a John Hopkins Taxation Accountant.

 

 

To arrange an appointment with a John Hopkins Taxation Accountant, please contact our Client Liaison Officer on 1300 726 082 or click here.




  

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