Have you been charged with Tax Evasion?

Not for an unpaid tax bill on its own. Under section 255-5 of Schedule 1 to the Taxation Administration Act 1953, unpaid tax is a debt due to the Commonwealth, and the ATO can sue you to recover it. Dishonestly evading tax can lead to prison: the ATO reports 13 custodial sentences from 28 convictions in its 2025-26 tax crime prosecutions. Failing to lodge is an offence that carries only a fine at first, but ignoring a court order to lodge carries up to 12 months in prison.

The maximum is 10 years in prison for federal tax fraud charged under section 134.2 or 135.1 of the Commonwealth Criminal Code. Within that limit, the judge or magistrate weighs the sentencing factors set out in the Commonwealth Crimes Act 1914, including the loss, any repayment, and whether you pleaded guilty and when.

Yes. The ATO refers serious tax fraud to the Commonwealth Director of Public Prosecutions for charges under the Commonwealth Criminal Code. The Taxation Administration Act 1953 also has its own, lesser offences, such as keeping false records to deceive the ATO. That offence carries a fine of 50 penalty units, 12 months in prison, or both. For an offence committed on or after 1 July 2026 that fine is up to $18,200, and for an earlier offence up to $16,500.

Deliberately evading, or trying to evade, a Victorian state tax is an offence under section 61 of the Taxation Administration Act 1997. It covers the state taxes that Act lists, such as land tax and payroll tax, and not federal taxes such as income tax or GST. An individual faces up to 200 penalty units ($41,820), 2 years in prison, or both. The offence needs a deliberate act or omission, so an accidental underpayment does not meet it.

Tax evasion is paying less tax than you owe through a blameworthy act or omission, such as leaving out income. The ATO says even an unintentional act or omission can be blameworthy, judged against the standard expected of a reasonable person. A criminal fraud charge needs more, because the prosecution must prove dishonesty. Tax planning is lawful: the ATO says you can arrange your affairs to keep your tax to a minimum within the law, including the anti-avoidance rules.

An ATO administrative penalty is not a penalty for an offence, so it brings no conviction. A prosecution can end in a conviction and a sentence. If you are prosecuted for an offence under the tax laws over the act or omission the penalty was for, the administrative penalty is cancelled and any amount you paid is refunded or credited. This does not apply to a fraud charge under the Commonwealth Criminal Code.

Yes, for an offence under the tax laws. Section 8ZH of the Taxation Administration Act 1953 says a penalty for a taxation offence, or a payment the court orders on conviction, does not relieve anyone from liability to assessment or payment of the tax.