The ATO has warned that it is aware of schemes that may be used to artificially create or inflate an entitlement to the cash flow boost.
These include artificial:
• business restructures that attempt to create eligibility for the cash flow boost
• arrangements to split a business that exceeds the $50 million aggregated turnover threshold, in order to create eligibility for both parts of the business
• re-characterisation of payments to salary and wages to maximise the cash flow boost.
Strong integrity measures have been designed to protect against these types of schemes.
Businesses involved in these schemes may:
• have their entitlement to the credit cancelled
• be required to repay the amount received, along with interest or penalties.
An advisor who helps a client to make arrangements to artificially create an entitlement for the cash flow boost:
• may have promoted a tax exploitation scheme
• could become subject to a civil penalty under the Promoter Penalty Laws.
If you have received a notice from the ATO regarding your tax affairs or have concerns about potential mistakes in your tax reporting, contact us for a confidential consultation: