There was a time in business where Cash was King, sadly that time is coming to an end as the Government looks to introduce new measures that could potentially see criminal penalties for cash payments or receipts above $10,000.
These offences protect the integrity of the taxation law and other Commonwealth laws by ensuring that entities cannot avoid scrutiny and facilitate their participation in the black economy by making large payments in cash.
The Black Economy Taskforce Final Report found that large cash payments can be anonymous and untraceable allowing businesses to under-report their income and for offering consumers discounts for transactions that reflect the businesses’ avoided obligations.
The Bill creates new offences that apply if an entity makes or accepts cash payments with a value that equals or exceeds the cash payment limit. However, the offence does not apply if the payment is either of a kind specified in the rules made under the Bill or made or accepted in circumstances of a kind specified in the rules.
The cash payment limit is $10,000. The cash payment limit will apply only to businesses and individuals that make or accept payments involving $10,000 or more in cash. The majority of businesses’ and individuals’ daily interactions involving cash are not expected to exceed the cash payment limit.
The cash payment limit applies to payments made or received from 1 January 2020.
The cash payment limit does not apply to private transactions (excluding real property transactions). Transactions with financial institutions or consumer to consumer non-business transactions will not be affected.
This Bill fully implements the measure Black Economy Package — introduction of an economy-wide cash payment limit from the 2018/19 Budget.