Australian Tax Authority Warns on Tax Havens

Stephen Harris

17 March 2008

Australian Tax Commissioner Michael D’Ascenzo has issued a warning against hiding income or assets offshore following an earlier announcement that the country’s Tax Office is investigating tax evasion and avoidance in Liechtenstein. Australian taxpayers are required to declare income generated in any other country, including tax havens to the tax authorities, said the commissioner. “The message is simple – people should be cautious when considering whether to use offshore structures or tax havens, including Liechtenstein, for abusive purposes. Australians have tax obligations for their worldwide income, including Australian and overseas sources like profits from tax haven entities and bank accounts.” “There are exceptions so I encourage taxpayers to read our tax havens and tax administration booklet for more information or seek independent advice,” said Mr D’Ascenzo. “People who use offshore structures to deliberately hide assets or income in tax havens, such as Liechtenstein, can face serious penalties including criminal prosecutions,” he said. The Australian tax authority is also concerned about transactions with offshore legal structures where supporting documentation is absent, incomplete or falsified.