What we are doing
Fraud is a shared risk across the community and requires everyone to work together to prevent and detect it.
We are continuing to detect and disrupt significant volumes of attempted fraud right across the tax, superannuation and registry systems.
We have enhanced our systems to protect people's personal information from criminals by putting additional checks in place to prevent and contain attempted fraud. These include client-to-agent linking and online access strength.
We have strengthened our ability to detect and prevent fraud through partnerships, technologies and approaches to help stay ahead of criminal behaviour. Using the data we have available, we continually monitor and adjust our systems to ensure that we can respond swiftly when these criminals pivot.
The dollar value of attempted fraud stretches into billions of dollars which, if lost, would mean less funding for important services such as health, education and infrastructure.
We take our role seriously to protect taxpayers from risks such as identity fraud and scams impersonating the ATO.
We continue to focus on bringing to account those who do the wrong thing while educating Australians on how to protect your personal identifying information.
We partner with law enforcement agencies to prosecute those who commit fraud. This includes state and territory law enforcement partner agencies and the Serious Financial Crime Taskforce (SFCT), who are pursuing a significant number of criminal investigations. We’ve already seen people receive jail time for these types of crimes.
We continue to recover fraudulently obtained funds through a range of debt recovery strategies.
Counter Fraud Program
The Counter Fraud Program (CFP) provides $187 million over 4 years from 1 July 2024 to prepare our systems to adopt industry best practices and implement new fraud prevention capabilities. These will strengthen ATO systems and controls, helping us prevent, detect, monitor and respond to identity crime enabled fraud attacks on our systems.
The CFP will see detection, containment, consequence and protection working together as one to enhance the tax, superannuation and registry systems against financial crime and fraud.
This bolsters our ability to fight back against the growth we see in identity crime enabled fraud and scaled fraud attacks across our digital services.
Building on these new measures, we will continue to grow the capability and tools we need to respond to fraud in an increasingly agile and sophisticated way.
We will make it easier for taxpayers whose identity has been compromised by helping them adopt stronger security and improve how we address fraudulent activity on their ATO account.
We are also implementing real-time messaging in the ATO app to alert taxpayers to high-risk online transactions and allow them to lock their account.
Types of fraudsters
Tax fraud can be undertaken by:
- first person fraudsters – people who commit fraud against the ATO using their own identity, or the identity of an entity that they control
- second person fraudsters – intermediaries who use the identity of an ATO client to commit fraud against the ATO (such as, tax or BAS agents committing fraud on their client accounts)
- third person fraudsters – people who use the identity of an ATO client they do not know to commit tax fraud (such as, obtaining an identity through a scam or data breach)
- enablers – people who use their skills, structures and networks to help facilitate fraud (such as to create opportunities for first, second and third person fraudsters to commit tax fraud).
Examples of tax fraud
When individuals or businesses commit tax fraud, they are trying to avoid paying their tax obligation, reduce their tax obligation or claim funds they are not entitled to. First and second person fraud indicators we look for include:
- failing to lodge a tax return or business activity statement (BAS)
- deliberately under-reporting income
- not reporting income
- claiming false deductions
- claiming personal expenses as business expenses
- falsely lodging BAS statements for GST refunds, for example in Operation Protego.
See examples in our Tax crime prosecution case studies.
Third person fraud indicators
People carrying out third person fraud use the identity of an ATO client who they do not know to access ATO systems and make changes to client details. Third person fraud involves a fraudster:
- obtaining personal identifying information (PII) relating to an ATO client from a scam, data breach, theft or other means
- using the obtained PII to assume the identity of the ATO client and dishonestly access ATO systems
- using dishonest access to ATO systems to steal information, and may attempt to transact with the ATO to obtain refunds they are not entitled to.
We hold those who commit tax fraud to account. See our Tax crime prosecution results.
What you can do
Fraud prevention is everyone’s responsibility. By following these tips, you can help to protect yourself:
- Be aware of what personal details you share, and keep your information safe online.
- Use a Digital IDExternal Link to access our online services and set your identity strengthExternal Link at the highest level you can achieve.
- Download and use our ATO app.
- Take prompt action when you think you may have had your identity compromised in any way. For example, by arranging cancellation and re-issuing of relevant government identity documents and notifying us so we can add additional protections.
If you suspect someone may be involved in fraudulent tax activity, you can report it at ato.gov.au/tipoff or by phoning 1800 060 062.