The alert warns businesses against colluding with related entities to create fake invoices for fraudulent GST refund claims.
The Australian Taxation Office (ATO) has issued a new taxpayer alert – TA 2025/2: Arrangements designed to improperly obtain goods and services tax refunds, on 29 July 2025.
This alert strongly warns businesses against using arrangements where a business colludes with another related business to create fraudulent invoices, so they can attempt to claim large GST refunds.
Tax professionals should be aware that these arrangements are increasing. The fraud is currently predominantly within the property and construction industry. The ATO has also identified early signs of it proliferating in other industries, particularly by privately owned and wealthy groups.
The arrangements vary, but have some or all of the following features:
- false invoicing between related parties (for example, inflated invoices or issuing invoices where no goods or services are provided)
- deliberately misaligning GST accounting methods across a group to contrive a GST refund
- duplicating GST credit claims in related entities for a single high-value transaction
- claiming GST credits for alleged purchases, development, and construction (by related entities) that never occurred
- the use of straw directors to try and hide the true relationship between related parties.
