Too often we get told stories by clients of how one of their friends is getting a very big refund and they wonder why they’re not. For those of you still concerned that you’re missing out, please read the following article from the Daily Telegraph dated 17 February, 2012
Tens of thousands of trades-people could soon face tax audits after the ATO launched its biggest-ever crackdown on accountants and tax agents operating in the cash economy.
The ATO has a hit-list of 1,000 tax agents who hold a high proportion of ‘cash economy-based’ clients that are suspected of submitting false returns.
These businesses include: takeaway shops, restaurants, electricians, plumbers and builders. Tax experts say it will be the clients themselves who will ultimately pay for their accountants’ bad practices, potentially leaving them bills for millions of dollars in unpaid tax and penalties.
Breaches would include: failure by agents to declare income, false deductions, and deliberate manipulation of BAS. The ATO intend to profile ‘each registered tax and BAS agent’ across the country to identify high-risk agents. Tradespeople heavily involved in the cash economy would ultimately come under the ATO microscope.
The ATO has previously relied on tax agents to help run the system. But they have now realised that an element of tax agents are ‘dodgy’ and that threatens the entire revenue model.