The ATO has revealed that it has received a record-breaking 15,000 tip-offs to its Tax Integrity Centre in the first quarter of this financial year as the agency continues its focus on the black economy. The ATO plans to visit 10,000 businesses this year as part of its plan to deal with the black economy.
The top categories of tip-offs the ATO has received so far this year have been about:
- not declaring income
- demanding cash from customers and/or paying workers “cash in hand”
- someone’s lifestyle does not appear to match their income level, and
- not reporting sales.
The ATO has found that cafés and restaurants top the list in terms of the total number of tip-offs received in the first quarter this year. Its risk indicators state that there is a black economy problem in the café and restaurant industry and the fact that tip-offs about this industry top its list means that there is still more work to be done to protect honest café and restaurant owners and workers in this industry.
The ATO has also received high volumes of tip-offs about black economy behaviour in the hairdressing and beauty, building and construction and cleaning industries.
The ATO has reminded taxpayers that trading in cash and paying their workers in cash is legal but failing to report the income to the ATO and not paying their workers their entitlements like superannuation is not only illegal but also unfair.
The ATO’s Tax Integrity Centre received almost 300 tip-offs in one day in early August. Further, tip-offs from New South Wales have topped the ATO’s list, closely followed by Victoria and Queensland. The ATO specialist team looks at each and every tip-off, regardless of whether they are received anonymously or not. Fifty-three per cent of people who provided a tip-off in the first quarter of 2019/20 provided their contact details to the ATO, which is a significant increase when compared to the same quarter in the previous year.
The ATO further requests contact details in case information provided needs further clarification, but this is not a requirement. It cannot inform people about the progress or outcome of the information they provided due to privacy laws.
Reporting can be done either by completing a tip-off form on the ATO website at ato.gov.au/tipoff or calling the Black Economy hotline on 1800 060 062.
Source: ATO media release, 31 October 2019.