The High Cost of Taking on The Tax Office

'Mongrel bunch of *******s': The high cost of taking on the Tax Office

"In 2017, the ATO wound up or bankrupted 37 businesses a week."

Who is going to watch the Four Corners investigation tonight? 8.30 AEST Monday night. What did you think?

 

If you read the case of rod douglas it involves PSI. He was an IT contractor who split his income with his wife despite being aware of the PSI rules and never seeking professional advice.

And now he complains. Come on rod you knowingly took the risk and got caught. A highly paid IT contractor never seeking advice to confirm his positon. Never sought a private ruling.

‘Pay them. You’ll never win.’

 

Every case is unique, it's just that some are more unique than others.

 

Follow up story today

Here's what the Australian Tax Office has the power to do

 

I see both sides of the story.

I have seen people unfairly targetted and at risk of criminal charges. To win their case in a clear verdict against the ATO, with costs awarded. And they are last woefully out of pocket. Thats not right.

And others are just approach tax like its a gamble and disregard obtaining basic advice.

These people getting ABNs cancelled - A good thing. Too many rogue employers looking to abuse employee rights and entitlements or "employees" who think they can benefit from participation in a scheme to circumvent employment laws for a few extra dollars and get their income without withholding tax. When you apply for an ABN now you have to complete a LONG list of declarations intended to catch those who are getting an ABN to work for an employer (see below). I know non-tax agent applications get a higher level of vetting. I have had a few people in recent months come to me after having a ABN application rejected. The ATO now profile the risky applicants and industries. But I believe the employers should be targeted...

Tax law has never allowed anyone to apply for or retain a ABN unless they are entitled. If the enterprise stops you must apply to cancel it and reapply later. Its not like a tax file number and something you are obligated to have. Its only allowed by tax law IF you are entitled.

They should change the laws so that the definition of contractor is very clear. PSI rules are easily abused through ignorance. But it just delays being caught. It doesnt mean you are safe.


I believe I am entitled to an ABN

I am not applying just because I have been asked to get an ABN as a condition of employment
Successful ABN applications may be reviewed and if an employer has required you to get an ABN it means you are unlikely to be entitled and your ABN may be cancelled

I meet a number of the key characteristics of a business, or will once started, eg:

• I source my own clients
• I can delegate my work to others if I choose
• I invoice for my work and set my rate of pay
• I have a bank account for the business separate from my own bank account
• I am responsible for my own public liability, professional indemnity and/or workers compensation/income protection insurance
• I have taken real steps to start my business, or
  • I am running an enterprise or
  • I am a Corporations Act company

I can provide evidence that I am entitled to an ABN if requested.
We review some successful ABN applications to ensure only businesses, enterprises or Corporations Act companies get, and keep, an ABN

I understand my obligations

To provide true and correct information in my ABN application
Penalties of up to $12,600 can apply for each false or misleading statement made in an ABN application

 

Government launches investigation into Australia Tax Office after allegations of unethical cash grabs - ABC News (Australian Broadcasting Corporation)

 

I won against the ATO a few years ago, wrote about it on the old forums; Won my court case against the ATO :)

 

Just had a read through...what happened to the GIC they assessed you on after lodging the 2012 tax return?

Seems ridiculous they can assess you on interest you haven't received into your bank account..

 

Interest and income do not need to be received. One of many fatal errors