March 28, 2017

Protect Yourself From Fraud During the Tax-Time Scramble

The tax man cometh, as they say... and in North America, the U.K., and many countries around the globe, that means everyone’s scrambling now to meet April deadlines.

For individuals and small businesses, filing tax returns on time and paying taxes are priorities. Then, it’s critical to sort through paperwork and either file it or securely destroy the information that does not need to be kept any longer.

Protecting confidential information in and out of the workplace helps avoid fraudulent tax return identity theft, which occurs when someone uses stolen credentials to file a tax return and claim a fraudulent refund.

While government security measures can help (in the U.S., for example, tougher rules significantly decreased identity theft cases from 512,000 reported in 2015 to 238,000 cases in 2016), there is still a lot that individuals can do to protect themselves.

Here are 8 tips to help reduce your risk of tax-related fraud and income tax identity theft:

• Keep online safeguards up-to-date including security software with firewall and anti-virus protections.
• Always use strong passwords.
• Learn to recognize and avoid phishing emails and any calls and texts from fraudsters that pose as legitimate organizations. Don’t click on links or download attachments from unknown or suspicious emails.
• Follow a thorough document management process that safeguards all tax-related information. Small businesses and self-employed workers and other individuals must keep records that support income and deductions or credits on tax returns for 3 to 7 years. Contact your federal tax department for information.
• Store paper records in a safe place (not a shoe box in a closet). If possible, lock them away in a secure desk drawer or a safe.
• If there are digital records, make a back-up just in case the hard drive crashes. Encrypt the files on the computer and back-up drive, and be sure to password protect files. Store the computer in a secure, locked location. Store the back-up drive in a separate location.
• Keeping documents that are not required increases the risk of a security breach and non-compliance with privacy legislation. Securely destroy paper documents that are no longer needed. A Shred-it All Policy is recommended so all unnecessary documents are destroyed. Shredding is the preferred method of destruction and a legal requirement for many paper documents. A document destruction partner will provide locked containers for the workplace as well as regular secure destruction services. Ask for a Certificate of Destruction after every shred too so there is proof that the information is destroyed.
• Securely destroy digital documentation that is not needed too. The only acceptable way to dispose of digital documents is to irreversibly destroy them (deleting data and emptying the trash bin from electronic storage does not permanently destroy the information). Schedule hard drive and e-media destruction. If information is saved on other mobile devices such as a smart phone or laptop, be sure the hard drives are destroyed when the devices are replaced or not working anymore.

Want to make sure paper documents you no longer need are recycled? Partner with a document destruction expert that guarantees secure destruction - and recycling.