Project Do It – Voluntarily Disclose Foreign Income
The ATO is giving taxpayers the chance, until 19 December 2014, to voluntarily disclose any undeclared foreign income. Taxpayers who make a voluntary disclosure will avoid significant penalties and criminal prosecution, ahead of a global crackdown on undeclared offshore income and assets.
Any individual, company, partnership, or trust, that is not already in the process of being audited or reviewed by the ATO in relation to undeclared foreign income, is eligible for Project Do It.
Benefits of Making a Disclosure
Taxpayers, who choose to make a disclosure under Project Do It, will benefit from the following:
- A reduced penalty of 10% on the tax shortfall and no penalty for a tax year where the additional income is $20,000 or less. Normally, penalties of up to 90% can be applied;
- A reduced amendment period of 4 years i.e. the ATO will only issue amended assessments, to include the foreign income, for tax returns that have been assessed in the last 4 years. Normally, the ATO has no limit to the number of years that it can amend for tax evasion;
- The ATO will not investigate the disclosure for the purposes of prosecuting a criminal offence nor will it refer the taxpayer for criminal investigation;
- The ATO will assist with repatriating the offshore assets to Australia, if the taxpayer wants to wind up the offshore assets.
- The ATO Australia has extensive tax treaties with 100 countries under which they can collect information about individual taxpayer’s offshore activities. The ATO also currently have treaties with 42 countries that allow the automatic exchange of information.
If taxpayers are considering making a voluntary disclosure, we can advise on and assist with the process.
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