Ex-pat pilots under fire from tax office

International pilots and high-flying bankers who avoid tax by ‘commuting’ to work in foreign capitals are among ex-pats at the centre of an Australian Tax Office crackdown.

International pilots and high-flying bankers who avoid tax by “commuting” to work in foreign capitals are among ex-pats at the centre of an Australian Tax Office crackdown.

Some pilots have been accused of staging fake separations from their spouses and pretending they are living overseas, including in the glitzy hubs of Dubai, Singapore and Hong Kong, to cheat the tax system.

“It‘s a massive web,” one source told The Daily Telegraph.

“They are on huge money and too many of them have been getting away with it. The gravy train is finished and not too soon.”

Private school fees and $10,000 a month “housing assistance” paid by their employers for their families who remain living in Australia are also being targeted as potential rorts. Among the ex-pats being examined are deep sea saturation divers who can earn around $40,000 a month working offshore.

Pilots are being targetted by the tax man. Generic photo showing pilots in a plane cockpit. Picture: iStock

The crackdown has caught one international pilot who claimed he was domiciled in Hong Kong but was really based with his family in Sydney. He has been hit with a $250,000 fine for dodging his proper tax responsibilities for two years.

The Daily Telegraph has been told that some high-earning Australian HSBC bankers who work out of Hong Kong are among those whose tax affairs are under the spotlight.

ATO assistant commissioner Tim Loh said people can have foreign bank accounts and a foreign holiday home but if they are Australian residents, they have to declare their worldwide income and pay tax in Australia.

Ex-pat bankers with HSBC are among those whose tax affairs are under scrutiny to make sure they are paying tax un Australia. Picture: NCA NewsWire / Jeremy Piper

“If you have a house in Australia, bank accounts in Australia, your family resides in Australia and you have Australian private health insurance, you are likely to be an Australian resident and you have to pay tax in Australia,” Mr Loh said.

“With our technology and super computers, there is no way you can fly under the radar.

“Tax returns in Australia can be subject to our data matching program.”

Mr Loh warned that the ATO exchanged information with foreign jurisdictions.

“We have very strong partnerships and we share information with other jurisdictions,” he said.

“Qantas pilots are sickof hearing stories of how some other pilots rort the system and brag about it.” Photographer: Brent Lewin/Bloomberg via Getty Images

Mr Loh said the ATO also had sophisticated data on holiday homes and rental homes amid reports some of the rogue ex-pats are boasting about selling their up-market “beach shacks” and avoiding capital gains.

“Qantas pilots who pay tax in Australia are sick of hearing these stories of how some other pilots rort the system and brag about it,” one source said.

“They think because they leave their families here but they are based overseas, they don’t have to pay tax. Some of them have been doing it for over 20 years.”

Some of the ex-pat pilots under scrutiny work for Cathay Pacific out of Hong Kong.

Mr Loh said it was difficult to say how many ex-pats were working overseas but reside in Australia and he warned that those who lodged their tax returns through tax agents were liable for providing the correct information and liable for interest and penalties if the tax return was incorrect.

"This isn’t a game of Guess Who? We are watching very closely and nowadays with sophisticated data matching it's easier for us to pick people up and make sure they do the right thing," he said.