16 Sep ATO warns about overseas charity tax schemes
The ATO has issued a taxpayer alert warning people to be cautious about arrangements promoting a tax deduction for gifts of pharmaceutical items to charities for use overseas. With these schemes the taxpayer makes a cash deposit for a vendor to purchase pharmaceuticals from a low cost overseas supplier.They are then valued for gifting purposes at a much higher cost. The difference in these amounts is covered by what appears to be an unsecured, long term, low interest loan purportedly funded by the vendor. The ATO are of the view that these arrangements are not legitimate, and that those involved may face a large tax debt, substantial penalties or even prosecution.