IN BRIEF
- Experts say tax season creates the perfect conditions for scammers, who use urgency and increasingly sophisticated AI tools.
- The ATO says it never sends text messages containing links or demands payment through gift cards or cryptocurrency.
When Joseph Sukkar's phone rang, nothing seemed unusual.
The number appearing on his screen matched the Australian Taxation Office (ATO) contact he had saved on his phone.
The caller claimed he had outstanding tax debts, and offered him a discount if he paid immediately.
Believing the call was legitimate, Sukkar transferred the money.
"I received a call ... they told me they had an opportunity. They had a discount for me to pay the tax office," he said.
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It wasn't until he reported the incident to police that he realised he had been targeted by scammers impersonating the ATO.
Fortunately, his bank was able to recover the money.
"The bank managed to locate the payment and returned it to me. It was around $7,000," he said.
Ironically, Sukkar works in cybersecurity, where he helps organisations identify and respond to online threats.
Even with that experience, he says the scam caught him off guard.
Experts warn that anyone can be caught out
Fraud expert Dr Rachida Ouysse from the University of NSW said scams have become increasingly sophisticated.
"Scams are on the rise, and I think it's easy for anyone — like you or me — to get deceived because these scams have become so sophisticated," she said.
Why scammers target tax time
Tax time creates the ideal opportunity and conditions for fraudsters.
Many Australians are expecting communication from the ATO, are thinking about money, and may feel pressure to lodge their returns quickly.
Ouysse says that's where behavioural economics comes into play.
She points to "nudge theory," or the idea that people are more likely to respond to prompts when they're already focused on completing a task.
"Completing a tax return imposes a mental burden," she said.
"The thought that 'I need to file my tax return' is constantly on people's minds."
That makes taxpayers more vulnerable to messages that appear urgent or official.
Millions lost to scams
The ATO received 1,386 reports of identity theft in May 2026.
Meanwhile, Australians lost $119 million to scams during the first four months of 2025, according to the National Fraud Investigation Centre.
CPA Australia says scammers frequently impersonate the ATO or registered tax agents through phone calls, emails and text messages to steal money or personal information.
"If something doesn't seem right, pause and verify the source," the organisation said.
How to spot an ATO scam
The ATO says there are several warning signs that a message may be fraudulent.
It no longer sends text messages containing links, and it will never threaten someone with arrest over an unpaid tax debt.
It also won't ask people to pay using gift cards or cryptocurrency, or request their passwords.
If you're unsure whether a call, text or email is genuine, the ATO advises contacting it directly using the official ATO website, the ATO app or your registered tax agent.
Experts urge Australians not to rush tax returns
While many Australians race to lodge their returns on 1 July, experts say waiting can actually be beneficial.
The ATO recommends many taxpayers wait until late July, when employers, banks and government agencies have usually finalised and pre-filled income information.
"There is no single best time that applies to everyone," Owais said.
"The best time is when you have all the information available and no further data is expected that could improve your tax return."
AI making scams harder to detect
Reflecting on his experience, Sukkar says scammers are constantly evolving and becoming harder to detect, particularly with the rise of artificial intelligence.
"AI now creates videos, and scams have evolved," he said.
"They pay attention to spelling mistakes and make them look excellent."
His advice is to slow down and independently verify any unexpected request for money or personal information, even if it appears to come from a trusted organisation.
"If you don't verify your sources, you'll believe it's true."
This story was produced in collaboration with SBS Arabic.
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