The recent Commissioner of Taxation v Ludekens Federal Court case highlights the heavy penalties promoters of these types of schemes can face, the ATO said in an announcement this week.
The court found two people had engaged in conduct that resulted in them being promoters of a tax exploitation scheme, the ATO said.
As a result, the promoters were penalised a total of $180,000.
“The court said the severity of this penalty is in line with community expectations given the conduct of the promoters. Promoters of tax exploitation schemes need to know they will likely be caught and heavily penalised,” the ATO said.
With the regulators’ increased data matching capabilities and the more open lines of communication between government agencies, the ATO has been warning tax agents for some time that the risk of being caught out if they fall foul of the law is significantly higher than it was in years gone by.