Tax Update: ATO Targets Cash Economy

Recent ATO data has revealed certain businesses operating in the "cash economy".

Location:
Brisbane
Division:
Tax Consulting
Publish date:
21 March 2017
Author:
Daryl Jones

Daryl Jones

Tax Consulting
Senior Consultant
Brisbane
+61 7 3001 8816

P: +61 7 3001 8816

ATO data has revealed under-compliance with certain businesses operating in the “cash economy”.  The ATO is focussing on businesses in the following industries:
 
  • Restaurants and cafes (45% cash only)
  • Building and construction (highest number of reports about potential tax evasion)
  • Hair and beauty (58% cash only)
 
The data collected leads the ATO to focus on industries where businesses show:
 
  • Unrealistic income relative to the assets and lifestyle of the business and the owner
  • Fail to register for GST/failure to lodge activity statements or tax returns
  • Under-report transactions and income according to third party data
  • Failure to meet super and other employer obligations
  • Operate outside the normal small business benchmarks
  • Reports from the community (“dob ins”)
 
The ATO will be visiting over 400 businesses in Canberra and Perth over the coming weeks (this follows businesses visited in Sydney, Adelaide, Melbourne and the Gold Coast).

If you'd like to know any further information on this topic please don't hesitate to contact us.