ATO Steps Up Effort to Uncover Tax Evaders

July 1, 2014 Taxation in Australia

CANBERRA – Australian tax authorities are turning to greater use of technology to uncover tax cheats and encourage greater tax compliance.

Over the weekend the Australian Tax Office (ATO) a new statement confirming that it will soon make greater use of advanced data mining programs to identify individuals with undisclosed incomes and asset hidden offshore, in an effort to eliminate tax evasion and boost the effectiveness of its currently running voluntary disclosure program.

The new data mining efforts will involve closer scrutiny of information provided by overseas tax authorities to Australian tax authorities about national taxpayers with offshore investments, and, further, the program will make greater use of data provided from local banks and financial institutions.

The uncovered information will be cross checked against the declarations made by Australian taxpayers in their own tax returns, to determine the total amount of income which may have been purposely hidden from tax authorities.

According to Deputy Commissioner of the ATO Michael Cranston, any uncovered data which seems to indicate potential undisclosed income will first be used to encourage the involved taxpayers to come forward and declare their incomes as part of the ATO’s Project DO IT, an amnesty program offering reduced penalty and immunity from criminal prosecution for voluntary disclosures.

Any taxpayers who are found to be hiding incomes offshore, but chose not to make use of Project DO IT may be subjected to an audit, and will no longer be liable to enjoy the lowered penalties granted under the program.