ATO announces crackdown on COVID-19 relief payments

The tax office is zeroing in on fraud schemes taking advantage of stimulus packages.

Businessman study report using a magnifying glass

The Australian Taxation Office (ATO) has announced that it is zeroing in on fraud and schemes designed to take advantage of the government’s COVID-19 stimulus packages, including the early release of superannuation and JobKeeper payments.

ATO deputy commissioner Will Day said that with so many Australians affected by COVID-19, it was important to ensure payments got to those who need them.

“We know the overwhelming majority of Australians are honest, and we’ve worked hard to help those people who are impacted by COVID-19 as quickly as possible,” Mr Day said.

“We also have an important role to ensure the integrity of the stimulus measures and when we uncover fraud or people seeking to exploit them, we’ll take action, as we know the community would expect us to do.”

The ATO stated that it would use income tax returns, information provided from super funds, payroll information and other information from third party sources to assess the risk on inappropriate behaviour.

The ATO stressed that it would not tolerate illegal behaviour or development of schemes that are designed to deliberately exploit these measures, seek to avoid tax, or prey on vulnerable Australians.

The agency has already seen some examples of fraud and fraudulent attempts or people developing schemes to try to steal money from the community.

“We’ve received intelligence about a number of dodgy schemes, including the withdrawal of money from superannuation and recontributing it to get a tax deduction,” Mr Day said. “Not only is this not in the spirit of the measure (which is designed to assist those experiencing hardship), severe penalties can be applied to tax avoidance schemes or those found to be breaking the law.

“If someone recommends something like this that seems too good to be true, well, it probably is,” Mr Day said.

Penalties for fraud can include financial penalties, prosecution, and imprisonment for the most serious cases.

“It’s important to carefully check eligibility requirements before applying for any of the measures,” Mr Day said. “Eligibility requirements for each of the measures are outlined on the ATO’s website. If you’re not sure, the best thing to do is check with the ATO or your tax professional.

“Our tax system works on a self-assessment model. We will generally operate on the basis Australians are honest, meaning we will accept the information we are provided with as true and correct and make payments,” he said.

“However, we will be conducting checks later, so if you've received a benefit as part of the COVID-19 stimulus measures and we discover you are ineligible, you can expect to hear from us. If you think this may apply to you, you should contact us or speak to your tax professional,” Mr Day said.

“It is much better to come forward to make a voluntary disclosure than waiting to be audited. If in doubt on how to proceed, we recommend seeking the advice of a tax professional.”

Mr Day also reminded the community to protect their identities and be vigilant of scammers at this time.

“If you receive a text message or email stating that your myGov details have been changed, or that you have applied for early release of super and you have not, don’t ignore these messages: check your myGov, call the ATO or your super fund to make sure your identity has not been compromised. But don’t click on any links – one technique used by scammers to steal your information is to mock-up messages which appear to be from the ATO,” Mr Day said.

Behaviours that attract the ATO’s attention in relation to the early release of superannuation measure include:

- applying when there is no change to your regular salary, wage, or employment information
- artificially arranging your affairs to meet the eligibility criteria
- making false statements or fraudulent attempts to meet the eligibility criteria
- withdrawing and recontributing super for a tax advantage – this could not only trigger anti-avoidance rules but also result in additional taxes and affect your eligibility for a super co-contribution.

Is the ATO doing enough to stop scammers stealing people’s super through the early release scheme? Are you worried about your super being safe?

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    To make a comment, please register or login
    24th Jun 2020
    Yep believe this when I start seeing convictions, this will have been the biggest rort ever

    24th Jun 2020
    This was a great move by the government to use super money to help people during Covid-18. Super is better used when needed not just left so that people get less pension when they retire.
    Horace Cope
    24th Jun 2020
    There is always a group of people who are prepared to buck the system and ruin it for those in genuine need. Hopefully the ATO will identify them and ensure that heavy fines are issued as well as forcing them to reimburse their super fund.
    25th Jun 2020
    well let's hope when the ATO identify suspicious payments it will learn from robodebt and call the recipient in for a chat rather than send an immediate demand
    24th Jun 2020
    You people were all braying for blood when all those people were being screwed by the Robodebt scam.This is much the same.Suck people into this poorly organised scheme and then find ways to screw them
    24th Jun 2020
    I dont think we are all worried about genuine cases, it's the goddamn rorters that need the book thrown at them and there will be many.
    Life experience
    25th Jun 2020
    I know of many who rot the system.
    And also know of a girl who worked a half day a fortnight and got the $1500 from her work on jobkeeper. She’s delighted. She lives with her rich family in a big house with no expenses.
    The people who really need it should only get it.
    25th Jun 2020
    paying kids $1500 for a short shift each week is a daft decision that defies common sense, jobkeeper would be just as effective with less waste if $150/day
    29th Jun 2020
    Well LE hope you are going to dob her in. I also heard that employers are having trouble getting these employees back to work as with the $1500 they receive for doing nothing why bother.
    25th Jun 2020
    Where there is any financial aid system there will always be those looking to rort it. The super withdrawal would have been by far the easiset to rort given there were no questions asked. Watch out for the next round of withdrawals starting next month as the second lot of $10,000 comes on line.

    As for Job Keeper, that was harder to rort since not only the employer but all the employees had to complete forms in order for the employer to apply for the financial support. This will be easy for the ATO to check. Likewise in Job Seeker will be easy to find the rorters because again there will be a 'paper' trail.

    Whilst the vast majority of recipients of either payment will be honest claimants, it is naive in the extreme to think there would be no criminal activity by some. And those criminals needs to be found and appropriately charged.

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