Melbourne Law School assists the Australian Taxation Office reclaim revenue

Melbourne Law School is assisting the Australian Taxation Office's efforts to reclaim revenue lost by businesses engaging illegal phoenix activity.

Associate Professor Helen Anderson and David Koch

Associate Professor Helen Anderson from the Law School recently participated in a video series with Australian regulators as part of this initiative.

The videos focus on "illegal phoenix activity". This occurs when a second company, often newly incorporated, arises from the ashes of its failed predecessor where the second company's controllers and business are essentially the same. The intention is to exploit the corporate form to the detriment of unsecured creditors, including employees and tax authorities.  The company in financial difficulties is placed into external administration, and its assets may be transferred for less than their true value to the new company.

Phoenix activity is a major source of lost revenue for the ATO. The Law School's involvement in the video series highlights MLS academics offering their expertise as part of a contemporary approach to solving the problem.

"It's something the Tax Office is cracking down on, and from our perspective it is excellent for Melbourne Law School to be involved in this video series," Professor Anderson says.

We are able to share our extensive knowledge and expertise in corporate law and tax law with government and the wider community. This is one of the reasons we were given a large discovery grant by the Australian Research Council."

The ARC grant was made to Associate Professor Anderson, Professor Ian Ramsay, Professor Ann O'Connell, all of the Melbourne Law School, as well as Associate Professor Michelle Welsh of the Monash Business School.

David Koch, respected finance journalist and the co-host of 'Sunrise' on Channel Seven, facilitated the video series. Alongside Associate Professor Anderson, the videos feature Deputy Commissioner Michael Cranston from the ATO, Brett Bassett from Small Business Compliance and Deterrence at the Australian Securities and Investments Commission, and Tom O'Shea, the Executive Director of Media & Communications Policy from the Fair Work Ombudsman.

"People looking at government websites will be able to see a short presentation to get the information they need without having to read large pieces of text," Associate Professor Anderson says, explaining the benefits of the format.

The videos will be available to the general public on the Australian Taxation Office's 'Tax Matters' website, and are a valuable resource for individuals and businesses to understand their taxation obligations.By Tarang Chawla