Every week, I speak with Australians who haven’t lodged a tax return for five, ten, or even fifteen years. Some were living overseas. Others were bouncing in and out of Australia. A few were deep in cryptocurrency trading through companies or offshore platforms. Many simply assumed the ATO wasn’t watching.
Then something happens:
• A bank shares account data with the ATO
• A crypto exchange reports transactions
• A tax agent refuses to act
• A loan application requires up-to-date tax returns
• Someone decides to move back to Australia
And suddenly the panic hits:
“What happens if I haven’t lodged a tax return for 10 years? Am I in trouble?”
If that’s you or one of your clients, here’s the blunt truth:
Why You Should Never Contact the ATO Before Getting Legal Advice
This is not the moment for DIY bravery.
The worst thing you can do is call the ATO without legal advice.
You must not poke the bear before you understand your position and strategy.
Once you speak to them, you lose control of the narrative. A lawyer can communicate under legal professional privilege, ensuring your disclosures and documents are protected.
Get advice first. Always.
How the ATO Catches Up — Even After 10 Years
Many taxpayers believe they were “off the radar.”
That radar is now a full 4K satellite-guided system with night vision.
Today’s ATO has:
• Complete banking transparency
• International information exchange (CRS and FATCA)
• Passenger movement records
• Crypto reporting from major exchanges
• AUSTRAC, ASIC, AFSA and Titles Office data
• Highly advanced matching algorithms
Being invisible is a myth.
If income exists, the ATO will find it — especially crypto income.
Internal link:
For more on international tax rules, see:
Before Speaking to the ATO — Know the Risks
Approaching the ATO directly can result in:
• Default assessments for all missing years
• Penalties up to 75%
• Compounding interest
• Residency audits
• Questions about offshore assets
• In extreme cases: criminal investigation
A tax lawyer can:
• Protect your strategy with legal professional privilege
• Review residency status
• Analyse crypto transactions
• Handle voluntary disclosure safely
• Negotiate penalties
• Regularise your tax position without triggering unnecessary red flags
This step is absolutely critical.
Internal link:
Residency rules explained here:
https://chrisgarlickbarrister.com.au/international-tax-residency/
Crypto Traders: You Are Not Invisible
Even if you:
• Traded through a company
• Used offshore exchanges
• Never converted crypto back to AUD
• Used stablecoins or cold wallets
…the ATO still receives data.
The idea that crypto is untraceable is an expensive fantasy.
Internal link:
More on crypto tax issues:
https://chrisgarlickbarrister.com.au/crypto-taxation/
Offshore Trusts and International Structures — What They Can (and Cannot) Do
Structures in places like the Isle of Man or Cayman Islands can be legitimate for:
• Asset protection
• Estate planning
• Non-Australian sourced future income
• Residency shifts
But they cannot:
• Erase past undeclared income
• Conceal Australian-sourced assets
• Retroactively fix ten years of non-lodgment
Used properly, they are planning tools.
They are not invisibility cloaks.
Becoming a Non-Resident — You Can’t Just “Get on a Plane”
Leaving Australia doesn’t automatically change your tax residency.
You must correctly sever:
• Domicile
• Permanent place of abode
• Economic ties
• Behavioural and personal ties
And the paperwork and timing must support the position.
A lawyer can help structure this properly.
You don’t need to notify the ATO when leaving Australia, but you also don’t magically become a non-resident by exiting through Gate 34.
Voluntary Disclosure — The Safest Path (When Done Properly)
Voluntary disclosure can:
• Reduce penalties significantly
• Eliminate prosecution risk
• Allow you to reset your tax affairs
• Minimise interest
• Avoid an ATO “reconstruction” of income
But done incorrectly?
It can make things far worse.
ATO voluntary disclosure:
https://www.ato.gov.au/business/large-business/open-and-effective-engagement/voluntary-disclosures/
Conclusion
If you haven’t lodged tax returns for a decade, or have significant crypto trading history, don’t panic — and don’t contact the ATO yet.
There are safe, structured, intelligent pathways to resolve your position without unnecessary risk.
Get expert legal advice first.
For confidential advice
Chris Garlick – Barrister-at-Law
Domestic & International Tax
Phone: 0417 427 535
Website: https://chrisgarlickbarrister.com.au/
Email: garlick.qldbar@gmail.com