The small business tax write-off of up to $20,000 per item was introduced in the May Federal Budget. Despite the ABC's reporting of apparent concern about the risk of tax fraud due to the "last minute" nature of the measure, any fear should be unfounded. The ATO has decades of experience administering announcements that have taken immediate effect, including incentives similar to the tax break announced. That being said, the concern should sound a warning to those wanting to over-step the boundaries of legitimate claims.
The ability to instantly deduct the cost of assets worth up to $20,000 was central to the Government's suite of small business measures announced in the May budget. As the tax office begins to deal with what it anticipates will be a large volume of tax-return claims made under the policy, the ABC can reveal its bureaucrats have expressed concern about the measure's vulnerability to fraud.In a document titled Response form to new policy alert, marked "for official use only", staff from the ATO's risk department state the extra claims will make it more difficult to detect high-risk refunds. It also states "fraudsters will take advantage of this more complicated environment ... to commit fraud by trying to look like legitimate businesses taking advantage of this initiative".