ATO’s Project Do It

[ Disclose your international finances with minimal ATO penalties ]
by Michael Garrone Published

Project Do It is a one off opportunity for taxpayers who have undisclosed international finances to come forward and disclose that income to the ATO with minimal taxation and penalty issues [provided they do so by 19 December 2014]. This initiative has never been offered before [and it’s not likely to ever happen again].

How might it apply to me?

International tax issues can be complex, so it’s not uncommon for ordinary tax payers to be caught out in the process and not properly disclose their information correctly on their tax return. Some examples include:

  • You came back from working overseas or migrated to Australia and never got around to bringing everything back [think bank accounts, investments or foreign pensions]
  • A business that does exports and imports where cash remained overseas
  • A foreign inheritance
  • Money held in trust for you by a foreign relative

It’s important to remember that there is nothing actually wrong with having assets held overseas or having foreign income. It becomes a problem when you are not paying the correct amount of tax on those foreign assets or disclosing them correctly in Australia.

What if you do nothing by 19 December 2014? 

What we do know is that the ATO has more information sharing occurring with overseas Revenue Offices than ever before.  This is now in excess of 100 jurisdictions and includes tax havens.  More countries are joining this program every day.

It is now far more likely in the future that you will get caught and will be left in the undesirable position where large penalties and interest will mount up for each and every year of non-disclosure – not only the prior four years. Where there is a finding of ‘fraud or evasion’ the ATO can amend as many tax returns as is required to include the income [eg: 10 or 20 years].

What do you need to know in order to make the application under Project do it?

  • Ensure you can be part of the amnesty [there are some exclusions]
  • You will need to make a full disclosure on a standard ATO document
  • You will require disclosure of income for the prior four years tax returns –  limited penalties will apply along with interest on any outstanding tax
  • The ATO will not voluntarily refer you to another law enforcement agency such as the Commonwealth Director of Public Prosecutions

If you believe Project Do It applies to you or require any assistance please contact a member of the tax team [or your usual contact at bD] so that we can help you take advantage of this amnesty.

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