Warning from the ATOAs your small business accountants we thought we would advise you on some recent information we have come across. The ATO has recently released a statement to the media to remind the business community in general of its obligations to keep within the law at all times in business or face the consequential penalties, stresses and potential criminal convictions. The ATO stated that in the previous three months 476 entities were prosecuted and convicted on taxation offences. Twelve of these people were then issued with custodial sentences! The ATO goes on to list some examples of fraudulent activities that were caught by the ATO and the penalties that were then imposed.
All small business operators must be aware that the ATO now has some major resources and funds from consecutive budget increases and that they are on the lookout for any business activity that falls outside what they would consider to be normal. The ATO can do this via small business benchmarking and unusual GST refunds that can be cross referenced between supplier and customer to ensure that what one has claimed the other has paid.
The lesson for all small business operators is to never engage in deliberate fraudulent activity. Where you feel that your activities may lead you into hot water, it is always best to seek out a trusted accountant for an honest, and sometimes, confronting advice on the proper course of action to be taken. It is better to be honest up front and deal with the matter than to face the stresses of an ATO investigation.