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Snap- The ATO are watching you… Closely

Back in 2013 and again in 2015 we wrote an article regarding the ATO data matching program. In this article we look at the current activities the ATO are doing to ensure all taxpayers are contributing fairly to enable the running of our country.

This is used by the ATO to identify taxpayers who are currently not registered to pay tax and should be. This electoral role also provides the ATO with your occupation and residential address. For example, instances of overseas and foreign investment and people who are avoiding paying superannuation and tax. This is also used where the details of the person need to be updated and tracing taxpayers who have outstanding obligations.

The main area and strategy as shown in the 2015 article for overseas investors and their behaviors. You can review the article here. The main targets are companies and individuals who are not reporting all of their foreign income. As advised in the 2015 article, if you do have overseas income, it  important you voluntarily let the ATO know the income that needs to be reported.

When a business discloses an invoice and receipt, the ATO are routinely collecting data on the payments to match employer obligations. This will help determine if people are failing to report income and payments, tax due and lodging tax returns/GST obligations. They are tracking everything from telephone number, dates of payments and the address of the contractor.

Attention Online sellers- Do you sell your goods on EBay?

Do you make money by selling your wares online? This is a relatively new tracking method but will be used to track businesses that have potentially gone from hobby status to be a business.  If you are selling more than $12,000 worth of goods/ services in a financial year, then you definitely are on the radar and should contact us now.

The information collected include PayPal details, Account name and date of birth of the account holder. It will be matched against other data records to ensure full tax compliance.

The information collected will be used to cross reference data collected in other areas. For instance, let’s say a contractor is reporting his income as $20,000 in a shorter period on a credit card, this information could flag onto the ATO system. The information here will make sure each person pays all their tax obligations, identify re-registered/liquidated businesses still trading and “cash only” businesses.

The data matching completed here is to ensure businesses/sole traders are complying with their tax and super obligations including tax credits, fringe benefits tax, luxury car tax and fuel schemes. Similar to the credit/debit card transactions, it is used by the ATO to identify taxpayers whose purchases do not commensurate with the income they have reported.

It is also used by the ATO to track dealers, fleet managers etc. to track when the wealth of an individual is trying to be concealed with the use of interposed proxy ownership.

The tracking of shares and securities should be no surprise to most Australians and has been ongoing since 2006. The main focus for the ATO is the Capital Gains Tax (CGT). As taxpayers can hold shares from as way back as to September 1985 which is when CGT was introduced, the data can be obtained from back then. The ATO are tracking over 61 million transactions.

As can be seen by this list, it is full and extensive, and there should be no reason why any individual or company should not meet their obligations. We are in a unique position to assist clients on both their financial, accounting and tax needs. We  have an internal philosophy “the left hand knows what the right hand is doing”. If you don’t feel you are getting a holistic view from your trusted adviser, please do not hesitate to give us a call.

Readers are encouraged to consult their adviser for advice on specific matters. This information (including taxation) is general in nature and does not consider your individual circumstances or needs. Do not act until you seek professional advice and consider a Product Disclosure Statement.Lindale Insurances Pty ltd ATF Lindale Insurances Trust ABN 27 027 421 832 is a corporate Authorised Representative of Millennium3 Financial Services Pty Ltd AFSL 244252