A draft legislation on restricting cash use was recently introduced by the Government. This was response to the Final report of the Black Economy taskforce’s recommendation to introduce a cash payment limit in Australia. As a matter of fact, other countries have already introduced cash limits. For instance, France instituted a €1000 ($1600) cash limit in September 2015. Spain has a limit of €2500 ($4000), while Italy €3000 ($4800).
The Currency (Restrictions on the Use of Cash) Bill 2019 proposes to establish a cash payment limit of $10,000 in Australia. It also establishes new offences for entities that make or accept cash payments that equal or exceed the cash payment limit.
From 1 January 2020, it will be a criminal offence to make or accept a payment from businesses that includes $10,000 or more of cash. It is also offence to make or accept a cash donation equal to or in excess of $10,000. The maximum penalty is up to two years imprisonment and/or 120 penalty units currently $25,200.
There are some exempt transactions being
- payments related to personal or private transactions (other than transactions involving real property); ie selling a second hand car.
- payments that must be reported by an entity under anti-money laundering and counter-terrorism legislation
- payments made or accepted by a public official in which the public official is legally required to make or accept a cash payment in the course of their duties;
- payments that only exceed the cash payment limit because the payment is part of a transaction involving collecting, holding or delivering cash and this is undertaken in the course of an enterprise of collecting or delivering cash (i.e., providing cash-in-transit services);
- payments that only exceed the cash payment limit because payment is or includes an amount of digital currency; and
- payments that occur in situations where no alternative method of payment could reasonably be used.
Learn more about it from Effective PD’s “Restricting Cash Usage and Outrageous Tax Claims” webinar. To subscribe, visit www.effectivepd.com.au. Effective PD offers an innovative way for busy accountants to be on top of their game with continuing professional development in a brief, flexible and easy way.
