The ATO said individuals and businesses who promote tax avoidance schemes often try to take advantage when businesses are vulnerable, as well as at key times of the year like tax time.
It said businesses should be wary of promoters that:
- offer inappropriate or artificial access to the stimulus packages
- offer zero-risk guarantees for their product
- offer access to your superannuation savings
- refer them to a particular adviser or expert that is associated with the tax arrangement (they may claim the adviser has specific knowledge about the arrangement and the promised tax benefits)
- claim to be an industry or topic expert without any supportive qualifications
- ask them to maintain secrecy to protect the arrangement from rival firms
- charge a fee or commission based on tax saved
- discourage them from obtaining independent advice
- do not have a PDS or prospectus for the product
- offer advice about illegal phoenixing or liquidation of key companies
“Becoming involved in a tax avoidance scheme could cost your client their entire investment plus interest and penalties,” the ATO said.
“We are asking the community to talk to us or a trusted professional if they’re unsure about any tax advice they’ve received.
“If you think your client is caught up in a suspect tax scheme, encourage them to contact us so we can work together to resolve any problems.”
Taxable payments annual report (TPAR) reminder
The ATO also reminded businesses that they may need to lodge a TPAR under the taxable payments reporting system by 28 August each year if they pay contractors to provide:
- building and construction services
- cleaning services
- courier, delivery or road freight services
- information technology (IT) services
- security, surveillance or investigation services
“If, in response to COVID-19 restrictions, your clients are offering new or expanded services that include these services, and they pay contractors to provide these services, they also may need to complete a TPAR,” the ATO said.
“For example, your client may be a restaurant that has delivered meals to their customers during the COVID-19 restrictions.
“If they charge a delivery fee and engage contractors to deliver on their behalf, they may need to lodge a TPAR. If the restaurant uses their own employees to make the deliveries, they do not need to report payments to employees on a TPAR.”