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ATO to target small business tax compliance

The Australian Taxation Office (ATO) has revealed today that it has small business in its sights in it’s 2010-11 compliance program.

Tax complianceATO Commissioner Michael D’Ascenzo today released the Compliance program 2010-11, outlining refund fraud, the cash economy, employer obligations, wealthy Australians and tax secrecy havens as some top priorities for the ATO in the coming year.

“This year, we will data match more than 500 million transactions to ensure taxpayers are declaring their income, including from bank accounts, investments, overseas transfers and property transactions,” Mr D’Ascenzo said.

“We have new risk filters and upgraded technology in place to better detect incorrect or fraudulent refund claims this year.

“We will crack down on businesses using cash transactions to hide income and evade tax, using benchmarks for more than 100 industries and reviewing or auditing the activities of more than 26,000 micro businesses.

“We will also focus heavily on employers – ensuring they lodge their business activity statements on time, meet their pay as you go withholding obligations and make correct super payments to employees.

“This year we expect to take action on more than 17,500 employee complaints about unpaid super. We will undertake 800 compliance reviews of business in industries showing a pattern of non-compliance including road freight transport, automotive repair and electrical services.

Mr D’Ascenzo said the compliance program had been guided by the ATO’s new strategic statement, which had a strong focus on encouraging and supporting taxpayers to do the right thing.

“We realise some businesses are still experiencing financial hardship as a result of the economic downturn and we will extend the measures to assist small businesses announced last year.

“Businesses having difficulty paying their tax debts should contact us early to work out how we can help them, for example with flexible payment arrangements or interest-free payment deferrals.”

Mr D’Ascenzo said Australia has a strong culture of voluntary tax compliance and part of supporting honest taxpayers was taking firm action against those who do the wrong thing.