If you have a Trades Business or any business really, have you thought about leaving some of your Income off your Tax Return? Perhaps you got paid cash or had some clients that never asked for an Invoice but still paid you? Or perhaps you just “forgot” about some of your Income
In my experience this sort of thing is wide spread in the Trades and Construction (as well as some other industries) and may people feel “Its Harmless” or “If they declare all their Income they will pay too much Tax” and generally believe they will never get caught. Actually in my experience the Tax Office is very sophisticated and if you are doing something wrong then they probably already know about it.
It may be that they are waiting until they have time to come and have a chat with you or perhaps they are waiting till the amount of tax and fines they can pursue from you is worth their time. If caught not only will you have pay back all the Tax you should have paid in the first place, you will be subject to fines and interest, these fines can be very large. In some cases the Tax Office will even pursue possible Criminal Conviction, In a recent court case a Bricklayer was sentenced to Jail for not declaring all of his Income. (you can read more about this case below)
If you feel you have forgotten something from your return or perhaps you are even having issues with the Tax Office or being Audited please get in contact. We are here to help and can help you bring everything back above board and get back to living your life. Contact our Tax Specialists here
Recent Article from the ATO:
November 2020 – Bricklayer behind bars
A Queensland bricklayer has been sentenced to two years and six months jail for evading nearly $100,000 in tax.
Over the course of a year, Mr Ben Ogden reported sales of $85,359 in his quarterly business activity statements (BAS). But an audit found he had actually received more than four times this amount. This resulted in a GST shortfall of $26,570.
Data from the taxable payments reporting scheme (TPRS) also showed that he had quoted the Australian business number (ABN) of his bricklaying trust to a number of entities, despite telling us it was no longer trading.
In addition to this, Mr Ogden understated income on his tax return, causing a tax shortfall of $70,441.
Paying the right amount of tax is part of running a business. We know that most people do the right thing. People who try to evade or cheat the tax system will be caught and will be held to account.