The ATO is on the lookout for advisers who are telling clients that, by operating their business or income producing activities through a private foundation, they can 'opt out’ of the tax system.
Jennifer Moltisani of ATO says:
Unlike genuine NFP foundations, participants stream their untaxed employment, contractor, or business income through the sham foundation, where they pay no tax on the income and use the funds for their own benefit. We’re taking this matter seriously and have already commenced investigations of potential promoters.
See the February addition of the ATO Not for profit publication