|
From the Australian Government, Tax Planning, investigate before investing What is Tax Planning? Tax Planning is when you organise your Tax affairs to give you the greatest tax advantage. This is legitimate when it is done within the letter of the law. Advice about tax planning arrangements for your particular situation can generally be received from accountants, tax agents, lawyers,financial planners as well as some other businesses. When Should you be aware of Tax Planning? Be alert to those advisers and promoters who market dodgy tax schemes - ones that are not within the spirit of the law and sometimes not even within the law. If you invest in a dodgy tax scheme, you are not only risking your original investment, but also face the risk of paying back any missing tax plus interest and penalties long after your adviser and money have gone. How do you tell a legitimate scheme from a Dodgy one? Promoters can be very good at convincing you the scheme is a good one, using professional marketing tools and attractive sales pitches offering big tax deductions or refunds. It can be difficult to know if you are getting sound advice, but here are a few lines that may draw your attention to a dodgy scheme; - There are no risks, we guarantee the returns
- You don't need credit or assets checks, we'll lend you the money
- Even if the investment does not go ahead, you will still make a profit from your tax refund
- Sign this secrecy agreement, we don't want our competitors stealing our ideas
- There's no need to ask the Tax Office if it is OK. We already have a ruling
- You can up to 100%deductions fully supported by Tax Office rulings
- A top lawyer and accountant have looked at the investment and they think it is great
- Your funds will be managed by an international bank (or international trust, or global corporation)
- We'll put your money in a tax-free overseas account
- You can run your business through your own offshore company
Basically, if it sounds too good to be true, it probably is. How do you investigate? Before investing: - Check licence details for free at www.fido.gov.au - people who offer financial products and advice must work for a business that holds an Australian financial service licence issued by the Australian Securities and Investment Commissions (ASIC)
- Contact ASIC at
This e-mail address is being protected from spambots. You need JavaScript enabled to view it
if you haven't received either a product disclosure statement or prospectus
- Get independent advice from an adviser who has no connection with the seller or investment scheme
- Check with the tax office at www.ato.gov.au or by phoning 1800 177 006 (or ask your adviser to do this) to find out if the scheme has a product ruling - many tax effective investments have product rulings. A product ruling provides you with a legally binding assurance that the tax benefits set out in the ruling will be available, as long as the scheme is carried out as described in the ruling
- Check tax payer alerts at www.ato.gov.au or phone the tax office on 1800 177 006 to find out if the scheme has any of the characteristics described in the alerts. The ATO taxpayer alerts are early warnings of significant and emerging tax planning issues that they are assessing
- Visit the Tax Office (ATO) website at www.ato.gov.au to apply them for a private ruling to confirm the tax effects of the arrangement. You can rely on the rulings as binding as long as the scheme is carried out as described in the ruling.
How do you report promoters of dodgy schemes?
If you have concerns about a promoter or a tax scheme, call the tax office Evasion and Referral Centre anonymously on 1800 060 062. The tax office will investigate further and take action to stop the promoter marketing the scheme if it seems outside the law. This will help stop other taxpayers from investing in the scheme. ASIC and the ACCC (Australian Competition and Consumer Commission) also look into schemes that may not be tax related. |
