Australia and the State of Queensland have a strict stance against tax crime.
To ensure compliance and deter potential offenders - severe penalties, substantial fines, and even imprisonment are imposed upon individuals found guilty of tax-related crimes.
With tax time on the horizon, it is important to understand the potential consequences of being charged with tax-related criminal offences in Queensland.
Understanding Tax Offences in Queensland
Tax crime, by definition, involves the abuse of the tax and super systems for an individual’s financial benefit.
Tax crime typically falls under tax evasion or fraud, it encompasses various activities such as hiding cash wages, avoiding tax, using complex offshore arrangements and/or falsely claiming refunds and benefits.
According to the ATO, examples of tax evasion of fraud include:
Making improper claims for deductions that the taxpayer did not have the right to receive.
Concealing information from the Commissioner or neglecting to maintain proper records.
Presenting forged, retroactive, or altered documents.
Paying employees in cash and failing to report their wages to the ATO.
Neglecting to remit GST, Pay As You Go Withholding (PAYGW) tax, or Superannuation Guarantee charges to the ATO.
Engaging in deceitful communication.
Masking personal expenses as business expenses for personal gain.
The Consequences of Tax Offences
Tax Fraud and Tax Evasion
Tax fraud involves intentionally providing false or misleading information to the tax authorities.
If found guilty of tax fraud, individuals can face severe penalties including fines and potential prison time.
Tax evasion generally refers to wilfully evading or attempting to evade tax obligations through illegal means. The ATO states “Typically, evasion in the income tax context involves omitting income from a return or wrongly claiming a deduction without any credible or excusable explanation.”
This offence can result in criminal convictions, substantial fines, and imprisonment.
Obtaining Property or Financial Advantage by Deception
Main offences in relation to tax crime that most commonly lead to legal proceedings are “Obtaining property by deception” and “Obtaining financial advantage by deception.”
Engaging in activities to obtain a financial advantage or property dishonestly, such as falsely claiming deductions or benefits, can lead to criminal charges.
The maximum penalties for both offences are 10 years’ imprisonment.
Conspiracy to Defraud
There is also an offence of ‘Conspiracy to Defraud.’
Conspiring with others to defraud the tax system is a serious offence.
Differentiating Serious Offences from Mistakes
While serious consequences can result from deliberate fraudulence of the tax system - some tax offences can arise from genuine mistakes.
In less serious cases, errors or misjudgements during tax returns may occur. It is important to note, however, that these matters are typically simpler to resolve and have a lower chance of garnering any severe consequences.
However, all Australian taxpayers are expected to abide by the law. Those who struggle to understand taxation should seek financial advice for assistance.
Seeking Legal Guidance
Navigating the intricacies of Australian tax law can be complex, especially when facing tax offences.
If you or someone you know is charged with a serious tax-related criminal offence in Queensland, it is crucial to seek professional legal assistance.
Contact Creevey Horrell Criminal Lawyers
Based in Brisbane, Roma, Toowoomba, and Townsville.
Visit www.chcriminallawyers.com.au/contact-us to contact us today.