All 11 properties were located in Victoria – across Melbourne and Shepparton – in a raid that involved 250 investigators from the Australian Tax Office (ATO).
“We are examining a group of tax agents suspected of facilitating phoenix activity and promoting avoidance of tax involving GST, income tax and the failure to remit pay-as-you-go withholding tax payments,” Jeremey Geale, deputy commissioner of the ATO, said.
“We suspect the agents have used phoenix techniques to assist clients to avoid paying tax on millions of dollars of income.”
The ATO used a mixture of its own intel as well as complaints from clients and other tax professionals. The identities of the tax agents and businesses being investigated were not disclosed.
According to Mr Geale, the ATO rarely uses its formal access powers, which demonstrates the seriousness of the alleged offences.
“We only use these powers in the most serious of cases, when taxpayers or their representatives refuse to engage with us within a reasonable period of time and where we believe there is a risk of records being moved or destroyed,” he said.
Mr Geale noted that such conduct not only deprives taxpayers of funds, but also provides an unfair advantage over tax agents and their clients who act responsibly. Clients of dodgy tax agents can also be left with “significant consequences and liabilities”.
In June this year, the Tax Practitioners Board warned business leaders and individuals to check that their tax agent is registered, noting that unregistered agents have been giving out advice online.