The ATO-led Serious Financial Crime Taskforce (SFCT) are warning businesses against trying to cheat the tax and super system by committing GST fraud.
Intelligence shared across SFCT partner agencies show businesses are using complex financial arrangements to disguise their transactions to gain a larger GST refund than they’re entitled to.
They’re engaging in these illegal activities by:
- providing false invoicing between related entities (for example, inflated invoices or issuing invoices where no goods or services are provided)
- deliberately misaligning GST accounting methods across the group. For example, one entity operates on a non-cash (accrual) basis whilst another uses a cash basis to create a GST refund as a result of the mismatched timing of the methods
- duplicating GST credit claims across related entities for a single high value transaction
- claiming GST credits for alleged purchases, development, and construction (by related entities) that have never happened
- using dummy directors to hide the true relationship between entities.
Deputy Commissioner and SFCT Chief John Ford said:
‘We are targeting businesses who are participating in these schemes to ensure a level playing field for those who follow the rules.
Not only is this behaviour putting honest businesses at risk, but it also takes funding away from vital community services such as healthcare, infrastructure and education.’
If you suspect a business is involved in a false invoicing arrangement or GST refund fraud, you can confidentially report it to us by making a tip-off online or by calling 1800 060 062.
If your business is involved in this illegal activity, we strongly encourage you to come forward and make a voluntary disclosure rather than wait for us to contact you. Early cooperation and voluntary disclosure of behaviour may reduce penalties imposed.
Read more about the Taskforce’s warning in the new intelligence bulletin.