ATO documents released under the Freedom of Information Act revealed that 5,974 investigations were conducted into claims for the wage subsidy program by the end of September 2020, with about a third found to be ineligible.
Certain businesses were found to have claimed under the wrong ABN, while other employers had not previously registered for PAYG withholding or added an employee after 12 March 2020 but backdated their employment to claim the payments.
The internal ATO files also showed that ineligible and fictitious employees had also been signed up for the program, with the Tax Office grouping them into risk categories, such as deceased, in jail, or out of country, as part of their investigations.
The ATO has confirmed that no known payments have been made to such employees.
“Where claims including fictitious employees are identified, no JobKeeper payments are or have been made,” said the ATO in an update on Saturday.
“Contrary to the impression given by some media coverage, the 6,000 red-flagged cases under investigation relate to all attempted claims stopped for investigation prior to payment. There have been very few attempted claims for fictitious employees.
“The ATO is not aware of any ultimately successful claim for deceased or other fictitious employees.”
The Tax Office also confirmed that it verifies the ABN of every business, as well as the tax file number of each employee, while using a range of “red-flag checks… over and above the use of Single Touch Payroll and other data sources”.
Treasurer Josh Frydenberg said he was “very confident” with the ATO’s robust compliance program.
“The ATO has comprehensive processes in place using Single Touch Payroll where they’re able to assess the employees of organisations and to ensure that that money flows,” Mr Frydenberg said.
“I’m very confident in the processes of the ATO around compliance and what has been delivered so far as a remarkable program that has helped save our economy in one of its darkest hours of need.”
Over $80 billion has been paid since JobKeeper was introduced in March last year. A total of 3.6 million workers were supported at the height of the program, with the figure dropping to 1.5 million employees after eligibility was tightened at the end of September 2020.
The JobKeeper program runs to 28 March, with the government standing firm on its decision to not extend it beyond its scheduled end date.
Jotham Lian is the editor of Accountants Daily, the leading source of breaking news, analysis and insight for Australian accounting professionals.
Before joining the team in 2017, Jotham wrote for a range of national mastheads including the Sydney Morning Herald, and Channel NewsAsia.