In contrast to tax avoidance, tax evasion is the process of individuals, corporations, or trusts illegally escaping the payment of tax by the deliberate misrepresentation of their affairs.
Tax evasion may involve declaring less income, profits, or gains than what was actually earned, or overstating deductions in order to lessen the amount of tax payable.
It is the role of the Australian Tax Office (ATO) to investigate reports or suspicions of tax evasion, and there are online forms available on their website which are for the public to use to report suspected tax evasion. There are serious consequences for tax crime, including penalties, criminal convictions, fines, and prison sentences.
The ATO has successfully investigated and assisted in the prosecution of several key tax evasion cases. For examples, including a failure to lodge/non-compliance case, a fraudulent work expenses case, and identity theft related income tax fraud, click here.