Compliance program 2012-13

Changes in taxpayer behaviour

We are seeing evidence of changes in taxpayer behaviour once we explain how we use benchmarks as part of our risk assessment process. Our tracking of the performance of taxpayers in six industries - carpentry services, clothing retailing, hairdressers, restaurants, takeaway food services and electrical services - shows significant increases in the number of businesses that now report income in the same range as their industry peers when they previously reported income that was well below that of other similar businesses, as shown in figure 2.1.

Figure 2.1

In 2010-11 we wrote to approximately 30,000 businesses because they were reporting significantly less income than expected. Of these businesses 17% have since started reporting income commensurate with their peers. This pleasing result represents over 5,000 businesses which have lowered their risk profile with the ATO and are less likely to be subject to audit.

Sections within Small business benchmarks raise awareness

• Changes in taxpayer behaviour
• Tax practitioner engagement
• Improvements