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The ATO hits the road

As part of the ATO’s work to “tackle the black economy and protect honest businesses from those doing the wrong thing”, the ATO is visiting:

  • close to 500 businesses in and around Port Macquarie and Wauchope, NSW;
  • around 700 small businesses in Broome, Cable Beach, Derby and Kununurra, Western Australia;
  • Darwin, Northern Territory;
  • around 500 small businesses in and around the Hornsby area (NSW);
  • around 400 small businesses in Healesville, Victoria; and
  • around 400 small businesses in Cooktown and Port Douglas, Far North Queensland.

According to Assistant Commissioner Peter Holt, there are a number of businesses in these regions not registered for GST or PAYG withholding, which can be a sign of the black economy, as well as a number of businesses with overdue income tax returns.

The ATO also receives intelligence from the community that some businesses aren’t playing by the rules, such as paying their workers cash in hand and keeping them off the books.

Other black economy signs that the ATO looks out for are things like lifestyle and assets far exceeding reported business income, sham contracting, a failure to provide payslips or a lack of merchant payment facilities like EFTPOS.

In this regard, Mr Holt said “We understand that some businesses may not have merchant payment facilities due to individual circumstances. The issue is when businesses are deliberately ‘cash only’ to avoid reporting all their income. By detecting and addressing this behaviour, we’re helping to keep things fair for honest small businesses.”

As part of the visits, ATO officers will also be providing information about recent changes, such as Single Touch Payroll and the extension of the Taxable Payments Reporting System to certain industries. “Local visits provide us with an opportunity to talk to business owners and help them get things right. During the visits, we may discuss record-keeping and payment facilities, outstanding lodgments, tax debts, and managing employee entitlements, such as superannuation,” Mr Holt said.

Some businesses are more likely than others to get a visit from the ATO, including:

  • Residential building construction;
  • Building completion and installation services;
  • Other construction services;
  • Building cleaning, pest control, and gardening services;
  • Accommodation;
  • Pharmaceutical and other store-based retailing;
  • Automotive repair and maintenance;
  • Cafes, restaurants, and takeaway food services;
  • Personal care services;
  • Legal and accounting services;
  • Computer system design and related services; and
  • Adult, community and other education

The ATO plans to visit almost 10,000 businesses this financial year in all States and Territories, across a variety of industries, as part of their strategy to deal with the black economy (they visited nearly 9,000 businesses in the 2018/19 financial year).

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