As tax season approaches in Australia, the focus typically shifts to deductions, compliance, and maximising returns. However, in today’s digital environment, cybersecurity has become an equally vital part of tax preparation—particularly when sensitive financial data is stored, transmitted, or managed online.
With the rising frequency of data breaches, phishing scams, and identity theft, it is essential for both individuals and businesses to take proactive steps to safeguard their tax-related financial records and personal information.
This guide outlines the most common threats, identifies who is most at risk, and provides practical strategies to protect sensitive data during the 2024–25 tax season.
Why Cybersecurity Matters During Tax Time
The tax process involves handling and submitting large volumes of highly sensitive information, including:
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Tax File Numbers (TFNs)
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Income statements and payslips
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Banking and investment account details
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Business Activity Statements (BAS)
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Superannuation account information
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Identity documents such as passports and driver’s licenses
This information is a prime target for cybercriminals, who may use it to commit fraud, impersonate individuals, or infiltrate financial systems. According to the Australian Cyber Security Centre (ACSC), scams targeting taxpayers significantly increase during tax time, often involving impersonation of the ATO via email, SMS, or phone calls.
Common Cyber Threats During Tax Season
1. Phishing Emails and SMS Scams
Scammers may impersonate the ATO or tax agents, urging individuals to verify personal details, claim refunds, or update account information through malicious links.
2. Ransomware Attacks
Small businesses and sole traders who store tax documents locally or on unsecured cloud platforms are vulnerable to ransomware, where hackers lock access to data and demand payment for its release.
3. Poor Data Storage Practices
Storing tax documents in unsecured digital folders, shared drives, or outdated systems increases the risk of data breaches and unauthorised access.
4. Malicious Software and Fake Platforms
Some attackers disguise malware as tax software or replicate legitimate platforms, tricking users into providing login credentials or downloading harmful code.
Who Is Most at Risk?
While cybersecurity is important for everyone, the following groups face elevated risks:
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Small business owners using online accounting tools
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Sole traders and freelancers who handle their own tax obligations
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Investors and high-net-worth individuals with diverse income streams
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Tax professionals and bookkeepers managing client data
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Anyone accessing tax information over public or unsecured networks
Best Practices to Secure Financial Data
1. Use Strong, Unique Passwords
Passwords should be complex, difficult to guess, and different across all platforms. Using a password manager can help manage and secure credentials effectively.
2. Enable Multi-Factor Authentication (MFA)
MFA adds an extra layer of protection. It should be activated on myGov, accounting software, online banking, and any platform used to store or submit financial records.
3. Keep Systems Updated
Regularly update computers, smartphones, antivirus programs, browsers, and any software used for tax preparation. Software updates often contain critical security patches.
4. Verify All Communications
Users should be cautious of unsolicited emails or SMS claiming to be from the ATO. They should avoid clicking on suspicious links and instead log in directly via official websites or contact support through verified channels.
5. Store Files Securely
Financial documents should not be saved on unsecured desktops or external drives. Encrypted cloud storage solutions with access control and regular backups offer better security.
6. Secure Business Environments
Businesses should take the following steps:
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Implement regular data backups
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Restrict access to sensitive financial information
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Train staff on identifying scams and phishing attempts
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Review cybersecurity policies at least annually
Responding to a Suspected Breach
In the event of a data compromise:
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Contact the ATO immediately via official contact numbers
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Report the incident to Scamwatch (www.scamwatch.gov.au)
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Update passwords and secure all user accounts
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Consider placing a credit alert or freeze with credit reporting agencies
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Scan affected devices for malware or viruses
Businesses must also report notifiable breaches to the Office of the Australian Information Commissioner (OAIC) in accordance with the Notifiable Data Breaches (NDB) scheme.
Recommended Cybersecurity Tools
Here are some trusted tools to help secure your tax information:
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Password Managers: 1Password, Bitwarden, LastPass
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Secure Cloud Storage: Dropbox Business, Microsoft OneDrive for Business, Google Drive with Vault
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Antivirus Software: Norton, Bitdefender, Sophos
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Authentication Apps: Google Authenticator, Authy, Microsoft Authenticator
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Accounting Platforms with Security Features: Xero, MYOB, QuickBooks
These tools can significantly reduce risk and help manage financial data more securely throughout the year.
Conclusion
As cyber threats continue to grow in sophistication, protecting financial data must become a routine part of tax season preparation. Whether managing personal returns or operating a business, Australians must treat cybersecurity as a fundamental component of their financial responsibilities.
By taking a few simple precautions—such as securing passwords, verifying communications, and using protected platforms—taxpayers can significantly reduce the risk of fraud and data loss.
Cybersecurity should not be an afterthought. It is an essential part of navigating the 2024–25 tax season safely and confidently.
Need Help Keeping Your Tax Data Secure?
Our experts can guide you on cybersecurity best practices, data storage solutions, and secure accounting tools tailored for your business.
👉 Reach out to us at biz@carisma-solutions.com.au for a secure and stress-free tax season.
Credits
Pramod S
Wealth Management Team