Many people fall behind in their obligation to lodge tax returns or business activity statements.
However, many people do not realise the risk of ending up with a criminal conviction by failing to do so. In the 2020 financial year, there were 26 convictions of serious tax crimes such as cybercrime, offshore tax evasion and serious financial crime with reparation orders totalling $1.63 million and 641 prosecutions in relation to summary offences which include:
- failing to lodge returns or keep records;
- making false or misleading statements;
- not responding to the Australian Tax Organisations questions when required; and
- failing to attend an interview with the Australian Tax Office.
Reparations of these summary related fines totalled a recovery of $4 million.
Failing to lodge your tax returns or misrepresenting information on your tax return, regardless of whether intentional or not, is a criminal offence. Failing to lodge tax returns falls under the respective sections of the Criminal Code Act 1995 (Cth) namely:
- dishonestly obtaining commonwealth property – section 134.1(1);
- obtaining financial advantage by deception – section 134.2(1); and
- dishonestly causing a loss to the Commonwealth – section 135.4 (3).
A consequence of missing the deadline to lodge tax returns is the imposition of a ‘failure to lodge on time penalty.’
The Australian Tax Office (ATO) issues warnings by phone and in writing. Whilst the penalty charges the ATO may impose are reasonably high, failure to lodge tax returns is an offence under section 8C of the Taxation Administration Act 1953 (Cth). Thus, of greater concern is the potential to be issued with a criminal charge, a criminal conviction and the possibility of up to 12 months imprisonment. The Court may also impose an additional fine up to $3,000 for a taxpayer’s first offence or up to $5,000 for subsequent offences.
If you have been issued a court attendance notice or correspondence advising that the ATO is seeking to prosecute you, speak to the team at Antunes Lawyers on (02) 9964 0499 so that we can represent you to avoid a conviction being recorded.
The articles on this website comprise legal general information and not legal advice. The general information presented here must not be relied upon without legal advice being sought. In the event that you wish to obtain legal advice on the contents of this general information you may do so by contacting our office or your existing solicitor.