In recent weeks, personnel from the tax office have been personally visiting small businesses across Victoria to assess their tax compliance.
Supposedly, up to 800 businesses will be targeted by the ATO and Fair Work Ombudsman.
The major suburbs likely to receive a visit from the ATO are Frankston and Croydon. Thus far, a wide range of businesses have reportedly been investigated, including restaurants, cleaning businesses, management consultants, takeaway food businesses, beauty services, and real estate firms.
When conducting visits, the ATO are specifically searching for illegal black economy activity. It is believed that a number of small businesses in these areas are demanding cash from customers and paying workers cash in hand.
Managing payroll and payments ‘off the books’ in this manner is illegal.
As we have mentioned in a previous article, the tax office are introducing various new laws in an attempt to stop all black economy activity across Australia. The concern with cash payments is that they are very anonymous and untraceable. With cash payments involved, not only can a business unfairly dodge their tax obligations, but they could also be underpaying their staff.
Whilst visiting shops and offices, the tax office may ask questions regarding record keeping, outstanding lodgements, tax debts, and employee management systems. If you are set to receive a visit, you should be notified by phone, email or letter prior to the visit.
So long as you have a quality accountant and bookkeeping system, you should have no problems when dealing with the tax office. As your small business tax champions, we are happy to assist you in answering any questions if the ATO visit your business.
If you have any questions regarding the above information, you can contact our team on 1300 4 PARIS.