The Government has welcomed the actions of an ATO-led taskforce in relation to what is termed “the biggest GST fraud in Australia’s
The ATO states that the fraud was first detected in early 2022 and involved offenders inventing fake businesses and ABN applications, then submitting fictitious Business Activity Statements in an attempt to gain a false GST refund. In response, the ATO’s Serious Financial Crimes Taskforce set up “Operation Protego” in partnership with the Australian Federal Police. Warrants were executed in three States against ten individuals suspected of promoting the fraud (which included the use of social media).
Some of the numbers involved are simply staggering in terms of the perpetrators’ audacity:
The purpose of our informing clients of this operation goes to GST audits conducted by the ATO and what they will be looking for should you
or your business be selected. As a starting point, generally, the ATO will apply at least some level of scrutiny to Activity Statements
where there is a refund of $5,000 or more or where the refund is uncharacteristically large for the taxpayer involved.
The key to staving off a GST audit is the obtaining and retaining of tax invoices. As your tax agent, there is no requirement for us to view each and every tax invoice you hold before we make a claim for GST credits on your behalf on your Activity Statement. However, no claim can be made without you being in possession of a tax invoice.
Tax invoices for purchases of less than $1,000 must include enough information to clearly determine the following seven details:
1. the document is intended to be a tax invoice
2. seller’s identity
3. seller’s Australian business number (ABN)
4. date the invoice was issued
5. brief description of the items sold, including the quantity (if applicable) and the price
6. GST amount (if any) payable – this can be shown separately or, if the GST amount is exactly one-eleventh of the total price, as a statement which says “Total price includes GST”
7. extent to which each sale on the invoice is a taxable sale.
Tax invoices for sales of $1,000 or more also need to show the buyer’s identity or ABN. The following example shows: