The ATO announced an 80% jump in non-lodgment prosecutions over the past 2 years targeting shadow economy operators, leading to more than $2.7 million in fines.
The shadow economy refers to people or businesses doing the wrong thing – not paying the right tax or super, demanding cash payments, or workers missing out on entitlements.
The numbers over the last 2 years:
– 350+ individuals and entities successfully prosecuted
– 305+ convictions secured – up almost 60% between 2024-25 and 2025-26
– QLD, NSW and WA accounted for almost 75% of prosecutions: QLD 28%, WA 26%, NSW 20%
ATO Assistant Commissioner Tony Goding warns: “It doesn’t matter if you’re a tradie, hairdresser or café owner – if you deliberately avoid paying the right tax, you risk more than financial penalties. A criminal conviction can impact your reputation, business viability, ability to travel overseas, and ability to borrow or obtain insurance.”
Lodging tax returns is a legal obligation, not a choice.
If you are behind on lodgements, BAS or super, now is the time to get back on track before the ATO takes action.
Source: https://www.ato.gov.au/media-centre/out-of-the-shadows-shadow-economy-prosecutions-jump-eighty-per-cent
General info only. This is not personal tax advice. Tax laws change. You should seek advice specific to your circumstances from a registered tax agent before acting.
