Tax Fraud

What Is Tax Fraud?

Tax fraud, sometimes called tax evasion, is the use of dishonest or unlawful means to reduce or avoid the tax or superannuation obligations you owe. It falls under the umbrella of white-collar crime, which is financially motivated rather than violent, typically associated with corporate or government settings such as embezzlement or insider trading. Tax fraud, however, is not limited to executives or business owners. Any individual who earns income can find themselves accused of this offence.

Tax fraud matters are prosecuted under several pieces of Commonwealth legislation, including:

• Commonwealth Criminal Code
• Taxation Administration Regulations
• Proceeds of Crime Act
• Crimes (Taxation Offences) Act

Minor or regulatory breaches may be dealt with directly by the ATO. Larger or more complex cases are handed over to federal investigators and prosecuted by the Commonwealth Director of Public Prosecutions. As with all criminal offences, the prosecution carries the burden of proving each element beyond a reasonable doubt.

The Serious Financial Crime Taskforce was formed in 2015 to focus resources on complex and organised financial offending. Its priorities include:

• Cybercrime affecting superannuation and tax systems
• Offshore tax evasion, where funds or assets are hidden overseas to escape Australian tax obligations
• Illegal phoenix activity, where a company is deliberately wound up and its operations restarted under a new entity to dodge outstanding debts and tax liabilities
• Financial crime connected to government pandemic support measures administered through the ATO

Tax evasion is not confined to legitimate businesses cutting corners. Organised crime groups are frequent offenders, largely because declaring income from illegal activity would draw the attention of law enforcement. These groups increasingly rely on sophisticated laundering techniques, moving illicit funds through legitimate-looking channels such as casinos, cryptocurrency exchanges or shell businesses to keep their earnings out of sight.

Common Tax Fraud Charges

Obtain Property by Deception

This offence applies where a person, through deception, dishonestly obtains property belonging to another with intent to permanently deprive them of it, and that property belongs to a Commonwealth entity. This offence carries a maximum penalty of 10 years’ imprisonment.

Obtain a Financial Advantage by Deception

This offence applies where a person, through deception, dishonestly obtains a financial advantage from a Commonwealth entity. This offence carries a maximum penalty of 10 years’ imprisonment.

Conspiracy to Defraud

This offence applies in several circumstances, including where a person conspires with another to dishonestly obtain a gain from, or cause a loss to, a Commonwealth entity, or where a person conspires to dishonestly cause a loss or risk of loss to a Commonwealth entity while believing that loss is likely. It is irrelevant whether the accused knew the third party was a Commonwealth entity. This offence carries a maximum penalty of 10 years’ imprisonment.

Speak to a Lawyer Today

The three tax fraud offences most commonly prosecuted are:

• Obtain property by deception
• Obtain a financial advantage by deception
• Conspiracy to defraud

If you are facing any of these charges, contact Best Criminal Lawyers Sydney today for a free initial consultation with an experienced criminal lawyer.

Disclaimer: The information above is general in nature and does not constitute legal advice. Every matter is different, so you should speak directly with one of our criminal lawyers to receive advice specific to your situation. Penalties referred to are maximum penalties only, and outcomes are determined by the courts on a case-by-case basis.