Tony’s tradies cop an ATO reaming

From Fairfax:

Hundreds of thousands of building industry contractors who may have dodged their GST or income-tax obligations have been hit with $2.3 billion in tax bills.

But there could be billions more outstanding, as the Australian Taxation Office (ATO) continues data matching information reported to it to identify operators in the cash economy.

A reporting system was introduced in 2012-13 that requires businesses in the building and construction industry to report payments they make to contractors.

The ATO had so far contacted about 250,000 contractors. As a result it has identified income tax and GST liabilities of $2.3 billion for 2012-13.

That’ll be a nice little hole in the small business stimulus.

Comments

  1. ROFL!

    This is in part desperation for tax dollars and part sticking it to unionists and the working man (fascist Torynuffs will be laughing hard).

      • Mining BoganMEMBER

        Correct. They’re entrepreneurs.

        Unions only hold them back from the riches that they so obviously deserve. It was probably those blasted fifth columnists that closed the hottest tradie competition too.

  2. Gunna be fun watching the ato confiscating 30,000 brand new utes to pay some tax bills.

  3. reusachtigeMEMBER

    Seriously, youse doom creators know nuffin! Every tradie I know, and I’ve met a lot at Loosie Lous, have at least one investment property to help with their tax!

    • They don’t pay tax, therefore they don’t invest to negatively gear, therefore they’re as ugly as a hat full of…….

  4. Thank goodness for this revolutionary idea of a $20k instant write off. Thats an extra $20k in everyones pocket !! Just like Negative gearing is …….hang on…..

    Does this mean – its not free money ?

    So confused.

    – Westy Bogan.

    • They also don’t realize normally they would write this off over 3-4 years, so over 3-4 years, this policy makes no bloody difference. Though considering the state of the economy, they probably won’t be in business after next financial year.

      They are also probably to stupid to realize we actually had this policy before (albeit only $10000), but Tony Abbott removed it when he removed the mining tax.

  5. Fair enough.

    It’s amazing how sophisticated the ATO’s matching systems are getting.

    • C.M.BurnsMEMBER

      IBM Watson and equivalent are bloody scary. And that’s just going off the capability they promote publicly

      • SoMPLSBoyMEMBER

        Yep, some of the Utes will have both alcohol interlocks and the new ‘caveat lock’ where unless you pay, that V8 won’t fire up.

  6. Even StevenMEMBER

    “That’ll be a nice little hole in the small business stimulus.”

    Gold, HnH.

  7. DouglasMEMBER

    The anger in the small business community is palpable when Apple can brazenly not pay about $2 to 3 billion of tax liabilities since 2001 yet thg govt and ATO is via these meanures and the regimen of Division 7A pursuing independent businesses and individuals which are. Australian but leting Apple,Ikea, etc off the hook. But what s law is law and fairness is an outdated concept.

  8. Far out. The understanding of our tax legislation, and the inability of people on here to do their homework, blows me away. The annual taxable payments report was introduced by the ALP for the 2013 financial year. It reports all payments made to sub contractors (the report is actually very similar what happens with employee payment summaries) in the building and construction industries. So for the first time the ATO has real details on payments. It has absolutely nothing to do with Abbott and was always going to be used by the ATO to chase non reporting sub contractors. It will also be used to chase contractor superannuation payments in those industries that are commonly not made.

    • Rubbish Bill. Those gutless turds in the ATO squeeze the littl guy and ignore the big guy. That is the total disgrace

    • DouglasMEMBER

      Bill. Your input is appreciated and I did say it is law to collect tax on all income. However, what sort of law is Australian tax law when Apple has evaded say 2.5 billion of liability over say 10 years with no action by the administrations whilst via the legislation of Division 7A has made the 30 per cent tax rate a comic fiction for many successful small businesses. I did not say it was right for sub contractors to not declare income.

      • fitzroyMEMBER

        If the anti avoidance provisions do not prevent transfer pricing, interest to associated companies in tax havens, and double Irish schemes, it is about time those schemes were challenged ruled upon and the law changed retrospectively

      • Mate we are not in disagreement. At least you know what Division 7A is. I call it Bondy’s legacy…why the ATO and the ALP moved away from the use iof bucket companies, whilst allowing the multinational to run riot, is a question that should be asked.

      • fitzroyMEMBER

        Sorry Bill, I am furious, I think they are scared of litigating and failing. I see no reason, if there is failure in the courts, why this is not a case for retrospective legislation, and the seizing of assets. It really is glorified theft by the multinationals.

  9. And glencore pays nothing on 15billion income, with its CEO making 1.01 billion on a rising share price with me paying tax last year on 120% of GROSS receipts despite being up to date in the BAS payments. A few scraps in the budget. Total bullshit from those turds in parliament. No default assessments, no High Court litigation, no retrospective legislation for their sponsors, just bankrupt the Local little guy. I do not exempt those ALP and Green turds either.

  10. I Report, and I report everyone to the ATO including the guy who sold the toilet paper and the cleaner who cleans the houses we rent in remote areas for the subbies and our accountant and the Devonport airport where the ute is parked when we fly back from the job. And I report Officeworks who delivers paper for the site copier. And I get complaints from them that the Tax office has called them. The tax office complains that I report too many and I only have to report those who actually contribute to the construction. But then they say it is for them to judge if I have reported correctly. So If I report I cannot be accused of not doing so. It drives the ATO nuts, The Carpark manager gets the irrits but I don’t get into trouble. I did get visited by the ATO to ‘train’ us to do what was required. They couldn’t give clear definitions. It was clear that the ATO culture is to believe that every person who works in construction is a criminal tax cheat and those that aren’t just haven’t been caught yet.

    • @ rex_gibbs.
      BS that you report to the ATO. The Australian tax legislation is based on self assessment. Until you are audited you are not required to substantiate your expenses. The ATPR for contractors in the building and construction industries was a move away from this. Do you you lot, including H and H and UE, have any real understanding of tax law in this country? Tax is a specialty. MB could do with investing in someone who understands tax law.

      • fitzroyMEMBER

        Tax law may be a specialty but the current state of affairs is a reflection of the inadequacy of political will. Were the ebay accounts to be put forward as a serious contention in a law court the lawyers would be in trouble. I see no difference between this and financial liability of whichever in the big 4 produced those accounts. This is a sham that is essentially an attempt to mislead the ATO into under assessing the company, this is quite different from arranging one’s affairs to limit liability. I would seize the assets and then go after the accountants.

      • DouglasMEMBER

        I am not a tax expert but I naively thought that Part IVA caught all arrangemgnts entered into for the principle reason of avoiding tax commitments. Is this ot true? Therefore Apple ,Google,Ike are caught.

        I am afraid I agree with Fitzroy that it all stinks and the govt and ATO want us small businesses to pay 49 per cent tax via Division 7A. However, when leading commentators like Alan Kohler and Tony Boyd do not understand this, what hope do we have. I wrote to Boyd (AFR Chantcleer) about this when he wrote a surreal article on the state of small business in Australia and he just does not get it.