Thousands of Curtis Island workers sweat on giant tax audit

THOUSANDS of Curtis Island Bechtel workers will be audited by the Australian Taxation Office in one of the most significant investigations related to incorrect claims in recent years.

The workers will undergo a dreaded tax audit, and face penalties if they don't resubmit their returns in the next week. The ultimatum has come after workers ignored stern warnings in recent days.

The letter sent to Bechtel workers on Curtis Island last week has now been forwarded to accountants in preparation of a claims do-over for some workers.
The letter sent to Bechtel workers on Curtis Island last week has now been forwarded to accountants in preparation of a claims do-over for some workers.


Those workers who suddenly changed tax agents and subsequently received a significantly larger return should be worried.

So should anyone who received a return more than $4000 for one year, or prepared their own returns, because they're the ones the tax office will target to recover up to $50 million.

Tax agents say they haven't been inundated with questions from concerned workers, and few have resubmitted their taxes.

The ATO was in town this week examining Bechtel workers' individual returns with almost 20 different agents. They've gone now, but they left a warning; we'll be back. Now Gladstone tax agents have been warned to prepare the evidence they need to support their clients claims.

And while the audit is inevitable, there is still a chance to escape the penalties. Workers now have less than one week to re-submit.

>>Curtis Island workers ordered to re-do tax claims

>>Tax office clarifies what Bechtel workers can claim

>>Accountants review Bechtel workers' claims with ATO letter

>>Tax office clarifies Living Away From Home Allowance

A worker who contacted us as John Doe said they were caught up in the "debacle" and weren't sure who to trust.

"We get our tax returns done by them and away we go," John Doe said.

"To now have this brought up, saying that potentially the advice we've been given is wrong is confusing.

"If we go to our accountant with this ATO fact sheet and they tell us all is well, who are we meant to believe? We don't understand this stuff, that's why we go to accountants."

Agents from the ATO, including Assistant Commissioner Adam Kendrick, visited just under 20 Gladstone tax agents this week as part of the investigation. They said all agents they met with welcomed the opportunity to clarify claims around allowances.

The ATO has been working closely with Bechtel management to clarify precisely what working conditions apply to the majority of workers.

They've cross referenced that information too and found, although there are exceptions, anyone making claims on travel for carrying "bulk goods" such as large tools have likely made a mistake. That claim has been made by about 70% of all Curtis Island workers.

Mr Kendrick said agents were most concerned about the social and economic impacts on the town when the ATO returned to claim back incorrect deductions. 

"We are asking more people to come forward and amend their returns so they won't face penalties," ATO's Mr Kendrick said. 

"People seem to have this belief that if they ignore us we're going to go away, but that's not going to happen."

This case is the most significant since the agency adopted a new attitude when commissioner, Chris Jordan, took the top job two years ago. Since then it has preferred to get taxpayers - and agents - to file taxes correctly rather than carrying out audits.


Is there a court case?

I heard there's an upcoming court case that will prove the tax office is wrong and I won't have to pay any money back or pay any penalties - right?

Wrong. The ATO has confirmed it has zero knowledge of any such a court case. But, if such a court case did exist, and there was a judgment finding the tax office was wrong, workers would be refunded any money they had paid back.

H&R Block taxation manager Karen Windress said workers believe they're entitled to these claims because of a clause in their Enterprise Bargaining Agreement. That has been dismissed by the ATO.

Gladstone tax agents are preparing to receive more advice from the ATO about what evidence needs to be provided to prove claims are legitimate during the audit. H&R Block is offering workers a second opinion on their taxes for free.

Bechtel workers have been warned they will undergo a tax audit and face penalties if they don't resubmit their returns in the next week:

Posted by The Observer on Thursday, October 22, 2015

Topics:  audit australian taxation office bechtel curtis island

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