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CE Distributors & Retailers Being Probed By ATO Over JobKeeper Payments

Distributors, consumer electronic suppliers and retailers who took Government money during the COVID-19 crisis are now being investigated by the Australian Tax Office.

The ATO is probing recipients of the government’s $32 billion cash flow bonus scheme, warning businesses found to have inflated tax liabilities of their employees to rort the payments could face penalties.

Retailers getting between $20,000 and $100,000 have been contacted by the ATO, with warnings their March business activity statements included increases in salary and wages.

“We are concerned that you may have received more cash flow boost credits than you were entitled to,” correspondence from the ATO to business operators said.

One business owner at a recipient business told The Australian Financial Review they had withheld more tax on worker incomes than usual in the March quarter, “due to upward variations being requested by employees”.

That move has attracted ATO scrutiny.

Several businesses are now facing the real probability that they may need to repay amounts incorrectly paid out in cash flow support by the government.

Businesses were told if they corrected errors before this week, they may avoid financial penalties including interest.

According to the ATO they are committed to helping businesses to get through the pandemic period, including offering support to access financial help, a spokesperson claimed.

“We know that most businesses are trying to do the right thing. However, we recognise that businesses have a lot on their plate right now and mistakes can happen,” she said.

“We are focussed on working co-operatively with people to resolve genuine and honest mistakes without the imposition of penalties.”

She said some cash flow boost recipients would receive communication from the ATO.

They added “We are concerned that they could have made a mistake and as a result they might have received an incorrect cash flow boost amount. If this is the case, we will not impose penalties and will remit interest if they revise their activity statement to correct it.”

The spokeswoman said the ATO also had a range of options available to assist businesses to repay any overpaid amounts and would work to support businesses having trouble paying any overpayments.

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