TAX NEWS - June 2010

Tax Amnesty declared by Australian Taxation Office (ATO)

Australians have hidden more than $400 million of income in overseas tax havens such as Switzerland and Liechtenstein.

But like the 4093 others who have already come forward, those who own up will be treated leniently. They have until June 30 to declare their offshore income before a tax amnesty ends.

So far, the Tax Office says, the disclosures made since the amnesty started in December refer to $406 million.

Besides Switzerland and Liechtenstein, Britain and Hong Kong are among the countries on the top of the Tax Office's list.

Under the amnesty, any taxpayers who failed to declare more than $20,000 in income in a financial year will be exempt from penalties if they come forward.

Taxpayers also have the possibility of receiving advice anonymously, about whether the Tax Office is likely to refer their case for prosecution.

The amnesty follows a similar move in 2007, when Project Wickenby had only started. Wickenby is led by the Australian Taxation Office (ATO) with the Federal Police, the Australian Crime Commission, the Australian Securities and Investments Commission, Commonwealth DPP and Austrac, which monitors large money movements. It targets those who promote and participate in illegal schemes in tax havens and was designed to increase taxpayer compliance.

The tax commissioner, Michael D'Ascenzo, warned that if the Australian Taxation Office (ATO) discovered undeclared income during an audit penalties could be as high as 90 per cent.