Tax scams are becoming more frequent, elaborate and hard to spot. In 2021 alone, they cost Aussies an estimated $2 billion, and that bill is expected to be even higher in 2022 and 2023.
According to the ACCC, investment scams were the highest loss category ($701 million) in 2021, followed by payment redirection scams ($227 million) and romance scams ($142 million).
“Scam activity continues to increase, and last year a record number of Australians lost a record amount of money,” ACCC Deputy Chair Delia Rickard said. She adds that “scammers are the most opportunistic of all criminals: they pose as charities after a natural disaster, health departments during a pandemic, and love interests.”
One of the most abundant scams are tax scams, which include:
- Tax refund scams: Scammers contact you claiming that you’re owed a tax refund and that they need your personal details and a processing fee to release your funds.
- Tax owed scams: Scammers contact you claiming that you have a tax debt and demand that you pay the debt to avoid being arrested. They may ask you to pay by credit card, money transfer, gift cards, or using a pre-paid debit card.
- Tax File Number (TFN) and Australian Business Number (ABN) scams
But the true impact of scams goes beyond a dollar figure; they also cause severe emotional harm to individuals, families, and businesses.
So how can you avoid being scammed and safeguard your pocket and identity from thieves?
The most critical thing to remember is that no bank or government organisation will ask for payment information via email or text. Notifications should be provided via letter or viewable in your MyGov account. NEVER click links in emails or texts, no matter how legitimate they look!
Phone calls can also be just as malicious, so do not provide any payment details or information, such as your TFN, without knowing who you’re speaking to and exactly what it is the call is about.
With scams running rampant, it’s best to confirm any information claiming to be from the ATO, even if you think the link may be legitimate, by actually contacting the ATO directly on 1800 008 540.
Remember that the ATO will never:
- Ask you to pay your tax debt into a non-ATO bank account, via pre-paid cards, or with cryptocurrencies like Bitcoin.
- Threaten you with an immediate arrest.
- Ask you to pay a fee in order to receive a refund.
- Ask for personal information such as your Tax File Number (TFN) or credit card number via email or SMS.
- Ask you to download files from the internet or open attachments in an unsolicited email.
If you are concerned your ATO account may be compromised or are uncertain about the authenticity of a call, email or message claiming to come from the ATO, call the ATO or your accountant immediately.
This also applies to any suspicious notifications you receive from banks or other organisations; contact the number on their official website and speak to a certified representative before taking any action.
When you have been targeted by a scam, it is critical to inform your Telco provider and report the scam to the ACCC’s Scamwatch.
If you fall victim to a tax scam or tax fraud, help is available. Call the ATO Client Identity Support Centre on 1800 467 033 for assistance.
For more advice on protecting your money and identity from tax scams, visit the Australian Cyber Security Centre or ATO online.
Owner of PCR Accounting & Advisory, Peter Marmara-Stewart is a top-tier accountant and financial advisor dedicated to helping clients reach their business goals and achieve financial freedom. Peter is highly regarded for his client-focused approach and entrepreneurial spirit, catering to a diverse range of professionals across a wide scope of industries all across the country. Peter’s expertise can help you plan effectively, set goals, maximise profits and protect your assets. Get in touch today on (03) 9847 7516.