The ATO has released an article which tells us it plans to protect honest businesses (those who report their income).
The ATO will focus on businesses that:
- operate and advertise as ‘cash only’
- our data matching suggests they don’t take electronic payments
- are part of an industry where cash payments are common
- indicate unrealistic income relative to the assets and lifestyle of the business and owner
- fail to register for GST or lodge activity statements or tax returns
- under-report transactions and income according to third-party data
- fail to meet super or employer obligations
- operate outside the normal small business benchmarks for their industry
- are reported to us by the community for potential tax evasion – the number of reports we receive shows us that the community is less tolerant of unfair practices in these industries.
The push is part of an ongoing push by the ATO to focus on the cash and hidden economy.
If you have made a mistake, or left information out of your lodgement, the ATO recommends going to them first, as reduced penalties may apply if you:
- haven’t told us about income you have earned, including cash payments
- claimed deductions you weren’t entitled to
- made any other statement to us that was false or misleading.
The results of failing to lodge correct information could be an investigation, audit, and even potential prosecution. As always it is essential to make sure that your information is correct.