The ATO has announced it is leading 2 taskforces to combat expanding threats from phoenix businesses and the misuse of trust structures.
Speaking about the newly prescribed Phoenix and Trust Taskforces, Acting Deputy Commissioner Will Day said that agencies now have extended information-sharing powers. He said recent figures show that phoenix activity costs the Australian economy $3.2bn each year. “It’s costing honest businesses almost $2 billion in unpaid debts and the non-supply of purchased goods and services,” Mr Day said. Businesses are not being paid for the products and services they supply and employees of phoenix operators are losing up to $655m in unpaid wages and entitlements such as super, he said
Set up just over 18 months ago to examine taxpayers using trust structures to avoid or evade taxes, Mr Day said the Trust Taskforce had already raised $350m in liabilities and $61.8m in collections. “We know that most businesses and families who have trust arrangements in place use them legitimately and are doing the right thing,” Mr Day said. The Trust Taskforce is cracking down on those exploiting trusts to conceal their interests, mischaracterise transactions and artificially deal with trust income to avoid paying their fair share of tax.
Source: ATO media release, 6 March 2015
[LTN 44, 6/3/15]
Two taskforces targeting phoenix businesses and the misuse of trust structures led by the ATO have been newly prescribed, enabling the ATO to share tax-related intelligence and data with other agencies.
Acting Deputy Commissioner Will Day said, the Trust Taskforce is cracking down on those using trusts to conceal their interests, mischaracterise transactions and artificially deal with trust income to avoid paying their fair share of tax. The ATO has said that the taskforce has finalised 21 audits and 397 reviews, of which seven serious cases were escalated for law enforcement action and two taxpayers are facing serious criminal charges.
The Trust Taskforce comprises the ATO, Australian Federal Police, Australian Crime Commission, Commonwealth Director of Public Prosecutions, Australian Securities and Investments Commission, Australian Government Solicitor, Attorney-General’s Department, AUSTRAC, Australian Competition and Consumer Commission, Australian Business Register and the Australian Prudential Regulation Authority.
The Phoenix Taskforce is made up of these entities as well as the Fair Work Ombudsman, Fair Work Building and Construction, the Department of Environment, the Department of Employment, the Department of Immigration and Border Protection and the NSW and Victorian Offices of State Revenue.
It is estimated that phoenix activity costs honest businesses $2b in unpaid debts and employees of these phoenix businesses are losing up to $655m in unpaid wages and entitlements.
Source: ATO media release, ATO leads taskforces on serious financial crime, 6 March 2015.