Scammers are out in force lately, which brings up the inevitable question of how to avoid tax scams. This pandemic has proven particularly useful to scammers who have been making claims such as “due to the pandemic we can’t meet in person”, or “due to the pandemic your delivery is late/has been missent, and we need an additional payment/to confirm your contact details”. And they are getting better and sounding legitimate. Here’s some ways to keep yourself safe during tax time.

Avoid tax scams by checking the source
If it seems to good to be true, it probably is

Update personal details directly with your tax agent or the ATO. Tax scams will attempt to get you to provide personal details by scaring you into handing over your information immediately, instead of going through the proper channels.

Phone calls: These are often automated messages warning you that fraud has been detected or there is an issue with your Tax File Number. Sometimes they may ask you to update payment details for a refund. The message will try to sound urgent to make you panic.

Emails: The email address will not be from a legitimate source. While they may have copied logos and phrases, they are often written poorly, and addressed generically instead of using you actual name and information.

Text Messages: These will ask you to click links to update information. They will be very generic and have a sense of urgency in them.

Letters: While scam letters tend to be less common they can still be used. Legitimate letters will have your identification details and direct you to the appropriate contact channels, which you will be able to verify online.

In all cases you should contact your tax agent, the ATO, or log into your MyGov account directly to verify if the ATO is legitimately requiring information from you, or assessing any issues with your account.

Tip 1: Don’t Panic! Tax scams rely on people reacting emotionally.

Scammers will try to get you to act quickly to make a payment or reveal personal details by inducing panic. Don’t fall for it!

Avoid scammers. Stay on top of your finances to ensure a tax scam doesn't leave you broke.
Don’t panic!

Tip 2: Check the Source.

Is the person calling or sending a message contacting you from a legitimate source? If you’re unsure, contact the ATO or your tax agent directly to find out if the request or warning is legitimate. Emails from your tax agent or the ATO will NEVER come from a generic email address such as “gmail.com”, and they will use the relevant person’s name or a department in the address. Contact the ATO directly or contact your tax agent. They are usually aware of prevelant tax scams, and can ensure you don’t get tripped up.

Tip 3: Don’t Hand Out Information Over the Phone

While legitimate businesses can request information over the phone, to be on the safe side it is best to provide sensitive information through more secure channels, where there is less chance that you are simply speaking to someone who is pretending to be from the legitimate business. Tax scams will try to get you to act immediately so that you hand over information without thinking. Your tax agent or the ATO will not pressure you to provide the information over the phone.

Tip 4: Verify suspicious warning emails, letters or texts by contacting your tax agent, the ATO or through your myGov account

They can be very convincing, so the best thing to do is to double check directly. Nothing is so urgent that you don’t have the time to go through the right channels. Remember that a tax scammer is trying to scare you into acting without thinking. Anything that is legitimately urgent will go through the proper channels and you will have proper deadlines attached to them.

If you have a tax agent, be consistent in using their services for tax related services, to update your information, notify you of payment information, and handle audits and issues with fraudulent activity.

Tip 5: Finally, avoid scams by keeping on top of your Compliance Requirements

If you are up to date with your compliance requirements then you are less likely to fall fall tax scams. When you know all your payments have been made and lodgements are up to date then noone can scare you into making additional payments. Staying on top of your compliance requirements will also reduce the risk of audits, fines, penalties or other issues with the ATO. If you know you’re at risk of fines and penalties it can be easier for scammers to take advantage of that concern.

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