A major outsourcing firm operating call centres for Centrelink paid no corporate tax for two consecutive years, despite generating hundreds of millions in revenue after securing a substantial government contract, an investigation can reveal.
Zero Tax on Major Government Revenue
Telco Services Australia (TSA), a Perth-headquartered company, reported more than $185 million in revenue for the 2024-25 financial year but declared no taxable income, according to newly filed financial documents. The previous year, it recorded $130 million in income and similarly paid zero corporate tax.
This two-year reporting period directly coincides with the company holding a multi-year contract worth over $90 million to run call centre operations for Services Australia, the agency responsible for delivering social security payments like Centrelink.
Complex Structure and Related Party Transactions
Financial analysts have raised concerns that the business appears structured in ways designed to avoid tax obligations in Australia. The documents, lodged on Christmas Eve, show $166.5 million in related party transactions in the last financial year alone, though the identity of these related parties is not disclosed.
"These payments virtually eliminate profits for the company," said Jason Ward, principal analyst at the Centre for International Corporate Tax Accountability and Research. He argued this results in no tax being payable, despite significant revenue. Ward called for the federal government to impose higher transparency levels on firms bidding for public contracts.
Notably, payments to directors and key management personnel increased during the 12-month period, even as the company reported a financial loss. There is no suggestion of illegal activity by the company or its directors.
Group Structure Obscures Overall Tax Picture
Telco Services Australia is one operational arm of the broader TSA Group, which employs over 4,300 workers across Australia and the Philippines. The group also handles outsourced operations for major corporations like Telstra and NRMA Insurance.
A TSA Group spokesperson stated that while the Telco Services entity did not record taxable income, "other associated entities did and the appropriate amount of tax has been paid by them." The spokesperson said the tax arrangements were assessed by an independent auditor and described the related party transactions as costs for services provided by associated companies, which are booked as revenue for those companies.
However, an analysis found the group's various businesses rarely lodge public financial accounts, which is unusual for a large operator. This complex structure makes it impossible to publicly verify the group's overall tax contribution or how money moves between entities.
Another arm, Telco Sales, which holds a flagship Telstra contract, paid just over $700,000 in corporate tax in 2022-23 but received a partial refund the following year, despite generating over $120 million in revenue across the two years.
Furthermore, while Telco Services holds the Services Australia contract, the staff are employed by a separate entity called Trimatic Management Services, which received $5 million in grant funding from the Western Australian government in 2024 to expand call centre jobs.
A Services Australia spokesperson said its workforce is built on a base of mostly permanent public service staff, supplemented by contractors. Centrelink also uses another outsourcer, Concentrix, for some call centre operations.
The revelation comes amid growing scrutiny of government reliance on outsourced services. Recent reports detail how most calls to the Australian Taxation Office are answered by workers at three private operators, with tax agents complaining of deteriorating service from inexperienced staff.
