ATO Data Matching Targets

Excessive work-related expense claims or incorrect rental property deductions will be the focus of the Australian Taxation Office’s data matching systems come tax time. The ATO has warned that taxpayers falsely claiming deductions they are not entitled to should expect to be caught out and incur penalties.

Around 12 million tax returns will be under scrutiny via the ATO’s sophisticated data matching systems which have been in operation since the 2008-09 financial year. Through cross-checking of employer, bank and government transactions the ATO will be examining excessive deductions claimed for holiday homes, splitting of rental income between husband and wives and unsupported deductions for jointly owned properties. Repairs and maintenance claims on newly purchased properties and interest deductions for private proportions of loans will also be scrutinised.

Work expenses which may already have been reimbursed by employers will be a focus of data-matching, as well as private expenses such as travel from home to work.

Independent contractors suspected of avoiding their tax obligations can also expect to be the target of the ATO's data-matching program. The ATO hopes to identify contractors that may not be meeting their taxation obligations by not registering or recording payments correctly.  The target years include the 2013/14, 2014/15 and 2015/16 financial years. The ATO will electronically match ABNs for payer businesses against ABNs of payee businesses (the contractors), cross-checking names and contact details of the contractor and the amounts paid including GST components.  The data will be extracted from invoices for the payer business and electronically matched with certain sections of ATO data holdings to identify non-compliance with registration, lodgement, reporting and payment obligations under taxation laws. Data may also be collected from other businesses associated with the contractor (payee) or payer businesses.

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Other articles in this edition:

• 2015 Individual Tax Return Checklist
• 2015 Companies, Partnerships, Trusts & Other Business Tax Checklist
• 2015/16 Budget Overview
• Small Business Measures 2015
• Personal Taxation 2015
• Other Budget Measures 2015
• FBT Changes 2015
• Keeping Track Of Your Business Growth
• Tech Corner... Video Chat Tools
• ATO Issues Scam Warning