Tax evasion is when an individual deliberately avoids paying their tax liabilities to the Australian Taxation Office for their own financial gain by providing misleading information. To effectively prevent and uncover tax evasion and tax related crimes, the ATO created a Serious Financial Crime Taskforce in 2015. Tax evasion is an illegal activity that is taken very seriously. Thus, the penalty for tax evasion can be quite severe, depending on the nature of the crime, penalties can include fines and imprisonment. If you have committed a tax related offence, it is best to get in contact with a criminal lawyer who can provide you with an adequate defence. Depending on the details of the charges and the circumstances of the activity, your lawyer will advise you of the best legal course for your specific case.
What are the methods of tax evasion?
There are many ways in which individuals and businesses can evade tax obligations. For example, the most common methods of tax evasion are:
- Neglecting to report income entirely or reporting less income than is accurate.
- Making false claims and deductions.
- Hiding assets in offshore accounts to reduce taxable income.
What is the penalty for tax evasion?
The penalty for tax evasion largely depends on the type of tax crime committed and its level of seriousness. As stated in the Criminal Code and Tax Administration Act, the maximum penalties for tax evasion and tax related crimes are outlined below:
- Obtaining a Financial Advantage by Deception: Imprisonment for 10 years.
- Failing to Comply with Requirements under Taxation Law: A fine of $2,200 for first offence.
- Conspiracy to Defraud:
- Obtaining a Gain: Imprisonment for 10 years.
- Causing a Loss: Imprisonment for 10 years.
- Influencing a Commonwealth Public Official: Imprisonment for 10 years.
However, the maximum penalties listed above are only passed down for the most serious tax evasion crimes. The Court will examine the nature of the tax crime committed as well as other factors such as criminal history and personal circumstances, when determining the most appropriate penalty for tax evasion charges. Other types of punishment may include:
- Community Service
- Home Detention with electronic monitoring.
- Intensive Correction Orders – Short term sentences of up to two years, that are served within the community whilst being closely monitored by authorities.
- Suspended Sentence – Imprisonment may be suspended for a period of time under the proviso that certain conditions are met and no further crimes are committed. If all conditions are fulfilled and no crimes are committed during this time, then the sentence may be abolished.
If you require further information in relation to the penalties for tax evasion or are facing charges in relation to tax related offences, get in touch with the professional criminal lawyers at Benjamin Leonardo today. Our criminal lawyers in Parramatta and Sydney are highly experienced in defending tax related offences and can offer expert advice and guidance for criminal cases relating to tax crime.