In its effort to facilitate a fair business environment, the ATO has offered continued support for honest businesses.
With an estimated $40 billion lost to the hidden economy, the need for strong diligence and continued governance over Australian businesses is essential. The Black Economy Taskforce that was established in May 2017 and various trends have since been better understood regarding strategies dishonest businesses and individuals are using to evade their tax responsibilities.
Trends show that problematic areas include:
- The sharing economy: the money exchanged through services such as Airbnb, Airtasker and Uber are all taxable. Ensure you understand how to be compliant before engaging with these services.
- Cash transactions: employers paying employees in cash to avoid tax and super responsibilities costs the economy an astronomical amount, as well as contractors accepting cash payments and not accurately documenting these.
- Incorrect reporting: individuals and businesses failing to report their business dealings correctly are creating huge liabilities in the economy. Small reporting dishonesties by a great portion of taxpayers creates a large balance of unaccountable money; the majority of unaccountable money in relation to tax evasion.