Do you own an investment property or an expensive lifestyle asset like a boat or aircraft? The ATO are looking closely at these assets to see if what has been declared in tax returns matches up.
The Australian Taxation Office (ATO) has initiated two data matching programs impacting investment property owners and those lucky enough to hold expensive lifestyle assets.
Investment property
What investment property owners declare and claim in their personal income tax returns is a constant focus for the ATO. Coming off the back of data matching programs reviewing residential investment property loan data, and landlord insurance, the ATO have initiated a new program capturing data from property management software from the 2018-19 financial year through to 2025-26. Data collected will include:
- Property owner identification details such as names, addresses, phone numbers, dates of birth, email addresses, business name and ABNs, if applicable;
- Details of the property itself - property address, date property first available for rent, property manager name and contact details, property manager ABN, property manager licence number, property owner or landlord bank details; and
- Property transaction details - period start and end dates, transaction type, description and amounts, ingoings and outgoings, and rental property account balances.
While the ATO commit to specific data matching campaigns, since 1 July 2016, they have also collected data from state and territory governments who are required to report transfers of real property to the ATO each quarter.
This latest data matching program ramps up the ATO’s focus on landlords, specifically targeting those who fail to lodge rental property schedules when required, omit or incorrectly report rental property income and deductions, and who omit or incorrectly report capital gains tax (CGT) details.
- Promote voluntary compliance and increase community confidence in the tax and superannuation systems.
- Assist with profiling to provide compliance staff with a holistic view of a taxpayer's wealth.
- Identify compliance issues related to income tax, CGT, FBT, GST, and superannuation obligations.
- Support debt management activities.
- Develop treatment strategies, including education or compliance activities, to improve voluntary compliance.
- Educate individuals and businesses on meeting their registration or lodgement obligations.
What lifestyle assets are included in the ATO data matching program?
Data from insurance providers is being used to identify and cross reference the ownership of expensive lifestyle assets. Included in the mix are:
| Asset Class | Minimum Asset Value Threshold |
|---|---|
|
Caravans and Motorhomes |
$65,000 |
|
Motor vehicles including: cars and trucks motorcycles |
$65,000 |
|
Thoroughbred Horses |
$65,000 |
|
Fine Art |
$100,000 per item |
|
Marine Vessels |
$100,000 |
|
Aircraft |
$150,000 |
The data collected is substantial including the personal details of the policy holder, the policy details including purchase price and identification details, and primary use, among other factors.
The ATO is looking for those accumulating or improving assets and not reporting these in their income tax return, disposing of assets and not declaring the income and/or capital gains, incorrectly claiming GST credits, and importantly, omitted or incorrect fringe benefits tax (FBT) reporting where the assets are held by a business but used personally.
