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You will not ‘outsmart’ the Tax Office, says TPB

Accountants have been urged to maintain their integrity in the face of client pressures to obtain stimulus payments, with the TPB warning that misconduct will be uncovered.

Tax&Compliance Aidan Curtis 08 April 2020
— 2 minute read

The profession has since been put on alert against engaging in schemes that will help clients access the cash-flow boost measures, as businesses scramble to fall within the eligibility criteria of the government’s economic stimulus package.

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However, despite the warnings, the Tax Practitioners Board (TPB) has said it is still fielding a lot of questions about the ethics of different scenarios.

Speaking on a recent ChangeGPS webinar, TPB board member Debra Anderson said a rule of thumb was that if an accountant or a business owner was changing something they would normally do in order to obtain the stimulus, then they were doing the wrong thing.

Ms Anderson warned that anyone trying to work around the system to get extra payments will not “outsmart” the Tax Office because of the data analytics systems in place.

“[It] is not a person at the Tax Office looking to see if you’re doing something wrong, or if youve changed something: [it] is a computer,” Ms Anderson said.

“The computer has been programmed to look at this, so if you think youre outsmarting somebody at the Tax Office, youre actually dealing with a system thats going to be just looking at everything in black and white, and then taking the exceptions out of that.

“If you have changed arrangements and youve legitimately done it and everything is there and you can back it all up, they will look at those individually.

“But if youre doing it just to get the stimulus, it will be picked up very quickly and theyve set up a team specifically for this both at the TPB and the ATO.”

Reporting misconduct

The ATO and the TPB have now both set up reporting methods specifically for attempts to rort the stimulus, and Ms Anderson encouraged accountants to report any misconduct.

While there have been concerns about breaching etiquette around private conversations, Ms Anderson said it was more important to report and stop potential rorts instead of keeping silent.

“We do need to stop this [from] happening, and I have to say the Tax Office and the TPB are already seeing [attempted rorts] in action,” Ms Anderson said.

“It is not that [the ATO and the TPB] don’t know about it: they do. We are going to come down really heavily and quickly.”

She also acknowledged an unwillingness to report unregistered agents after practitioners complained that no obvious actions were undertaken by the TPB.

Ms Anderson said that while unregistered agents currently fall outside the scope of sanctions, the TPB still does take action against them.

The TPB either asks an unregistered agent to cease and desist or takes them to a federal court, which Ms Anderson said happens quite regularly.

“There is this privacy concern, and unfortunately, we aren’t allowed to contact you to tell you what happened with that particular case,” Ms Anderson said.

“Some people think we’re not [taking action], that we haven’t done anything, but unfortunately, our hands are tied with the Privacy Act.

The ATO is not a policymaker

Ms Anderson reminded accountants that the ATO was not responsible for drafting the legislation or policy of the new stimulus measures.

“They’re just another department; they don’t do policy,” she said.

“The government does policy, the government says, ‘ATO, you now implement and make it work’.

“So, the Tax Office is still trying to deal with this as well. They’re scrambling to get all the systems in place.”

You will not ‘outsmart’ the Tax Office, says TPB
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