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ATO Puts Employers Under New Scrutiny From Immigration Department

Written By Will Aldous
Sun, Dec 9, 2018
Will Aldous

With the implementation of the new Single Touch Payroll system by the ATO, automatic audits of visa compliance by The Department of Home Affairs (DHA) may present a real problem for Australian businesses, who can face fines of up to $315,000 for breaching visa conditions.

Designed to electronically report tax and super information to the ATO every time a business pays their employees, Single Touch Payroll (STP) has been introduced gradually by the ATO since July 1st.

Since then, data collection through STP has become mandatory for employers with over 20 workers, with low cost solutions on the way for small business operators in the next financial year.

The ATO has also confirmed this data will be shared with several government departments to perform more efficient audits on business activity.

While the ATO has suggested that businesses should not ‘panic’ about single touch pay roll, many Australian businesses aren’t aware of their full obligations, or are simply not compliant when it comes to ensuring the on-going work rights of their visa-holding employees.

It has been stated by the ATO that the DHA will be requesting ongoing payroll data to better identify ‘illegal non-citizens’. In addition, the Taxation Administration Act empowers the DHA to access records of visa holders and employers in order to perform any functions of the Migration Act.

These powers will allow the DHA to audit the payroll information of any business to identify individuals working in breach of their visa conditions, and the employers who will face penalties as a result.

While many employers assume that labour hire and recruitment companies are assessing all candidates before they’re put forward, it remains the employer’s responsibility to check their employees work rights. This includes both an initial check during on-boarding, and ongoing checks for the duration of employment.

Company directors can be held personally responsible for non-compliance, even if they are unaware of the specific employee, and can face fines of up to $63,000 per illegal worker.

To further improve compliance, from December of 2017 the DHA has collected tax file numbers from all new visa applicants, enabling simplified data matching between the two departments.

This makes regular work rights checks more important than effect to ensure your business avoids hefty financial and reputational penalties.

The Checkworkrights application simplifies initial checks and automates ongoing visa checking for employers of all sizes. Explore their smartphone passport scanning app for free today.

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