Eleven sites across Victoria were accessed in August by more than 250 ATO officers as part of a broad investigation into alleged phoenix activity and avoidance of tax.
Deputy Commissioner Jeremy Geale confirmed the access without notice at business and residential sites across Melbourne and Shepparton to gather information as part of a long-term compliance action into a range of tax mischief.
“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.
“We suspect the agents have used phoenix techniques to assist clients to avoid paying tax on millions of dollars of income,” Mr Geale said.
The compliance action was triggered by complaints from concerned tax professionals and clients, as well as the ATO’s own intelligence.
Mr Geale explained the ATO rarely uses its formal access powers and the decision to undertake access without notice was not taken lightly.
“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 said the ATO is committed to protecting honest businesses, their employees and suppliers.
“Tax agents play a vital role in contributing to the integrity of the Australian economy.”
As primary advisers, tax agents have a significant influence on whether small businesses comply with their tax, super and other regulatory obligations.
While the majority of tax agents do the right thing, there are a small number of agents who don’t participate appropriately in Australia’s tax and super system.
Tax agents who fail to meet the required professional standards may be gaining an unfair advantage over other tax agents and businesses who do the right thing, and often leave their clients with significant consequences and liabilities.
The ATO is taking broader action against high risk agents, also known as ‘Agents of Concern’, to ensure there are significant consequences for the agents as well as referring the agents to the Tax Practitioners Board.
If a member of the community has any knowledge or concerns about someone doing the wrong thing they can report it online at ato.gov.au/report a concern or by calling 1800 060 062.
Victoria Police supported ATO officers at several of the sites with the visits. As the matter is currently under investigation, no further comment can be made at this time.
