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Here's what to do if your tax identity is stolen

Image: Getty

The closest thing Australia has to a national identity system are tax file numbers, which almost every adult has.

As the key that exposes a person to tax liabilities or credits, the confidentiality of the number is paramount to protect against identity theft and financial loss.

“Keeping your tax file number safe is important," Chartered Accountants Australia and New Zealand senior tax advocate Susan Franks told Yahoo Finance.

"The Australian Taxation Office recommends that you shred documents containing personal details before throwing them away, make sure your passwords are strong, put a padlock on your letterbox or use legitimate and up-to-date antivirus, firewall and anti-spyware software."

If you suspect your number is known to other people, here are the steps to take:

1. Report the incident

If you suspect your tax file number is known to other people and your identity is compromised, the ATO advises reporting the incident straight away:

  • Phone the ATO on 1800 467 033 for stolen tax identities

  • Phone the ATO on 13 28 61 for a compromised myGov account

"Cybercrime can also be reported to the Australian Cyber Security Centre via the Cyber Issue Reporting System, however all tax related security issues should be reported to us," the ATO states.

"You can also report identity theft and fraud to your state or territory police."

(AAP Image/Lukas Coch)

2. Re-establish your identity

In cases of stolen identity, the Australian Taxation Office advises victims to phone its Client Identity Support Centre (1800 467 033) to re-establish your credentials.

"When you phone us, we'll discuss the identification documents you'll need to provide," states the organisation.

If there are non-tax credentials that were also compromised, victims should contact IDCare (1300 432 273), which is a non-profit organisation that provides counselling and analysis for Australians dealing with stolen identity issues.

3. How the ATO responds

The tax office states that how it responds to a case of identity theft depends on the situation.

If someone knows your tax file number but there's no evidence they've used it, the ATO will want to know what other personal data that person could possess.

"This is so we can determine the level of risk to your account.

"If we determine your account to be at risk, we will check for any unusual or suspicious activity."

If the tax file number has been used by another person, but that person is known to the legitimate number holder, the action will "depend on the circumstances".

"After re-establishing your identity, we will review your situation and the level of risk. We will then discuss any further action taken."

If an unknown person has hijacked your tax file number, the tax office will try to sort out which activities are from the correct holder and which transactions are fraudulent.

"Once we've determined which activity on your tax file is yours, we'll correct the details in your account. For more complex tax affairs it may take longer for us to confirm and correct your details."

4. Monitoring the tax file number

The ATO may also keep an eye on the account before it allows any automatic processing of tax returns.

"If a tax return has suspicious activity, we may contact you to confirm the details before processing commences.

"The security measures we apply will remain on your file until we determine there is no further risk."

Safer now than in the past

CA ANZ's Franks said technology has actually improved security for taxpayers as we're now less reliant on tax file numbers as the sole identifier.

"The ATO now uses voice biometrics which around 4.7 million people have enrolled in and 8.7 million people are linked to the ATO through myGov. When myGov is accessed, a security code is sent to the linked mobile to ensure that the appropriate person is accessing myGov.

“The recently launched MyGovID uses fingerprint and facial recognition to improve security.”

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