Tax dodgers urged to confess
Australians who have dodged tax outside Australia have less than five months to voluntarily disclose or face going to jail, a law firm warned.
Mills Oakley Lawyers said evaders can voluntarily disclose tax evaded through false deductions and offshore undeclared income through the Australian Taxation Office (ATO) initiative Project DO IT.
Short for ‘Disclose Offshore Income Today', tax evaders have until 19 December to disclose if they want to avoid tax penalties and criminal charges, including jail time.
"The window of opportunity is certainly closing rapidly and we are seeing an increase in Project DO IT queries from taxpayers, including serious evaders, anxious to beat the deadline," Mills Oakley Private Advisory tax partner Jack Stuk said.
Those who qualify for the project only need to pay tax evaded for limited periods of review, usually the last four years, with the time before that forgone by the ATO.
Also, those eligible will have a shortfall penalty of a maximum of 10 per cent, which means an end tax bill of 110 per cent of the evaded tax amount for that four year period.
"Great care needs to be taken at every stage during the disclosure process," the law firm said.
"Full and upfront disclosure is paramount if the taxpayer proceeds. Anything less than the truth (‘the whole truth and nothing but the truth') will be rejected when that fact comes to light."
If ATO finds the tax evader first, they will likely face penalties of up to 95 per cent of the shortfall, a total tax bill of up to 195 per cent of the total tax dodged (not just over the last four years), and substantial jail time.
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