The ATO is ramping up audits of taxpayers with rental deductions after finding nine in 10 claims contained errors.
The ATO is ramping up audits of taxpayers with rental deductions
after finding nine in 10 claims contained errors.
ATO has audited 1500 taxpayers with rental claims and applied penalties
totalling $1.3 million in 2017-18, but expects to carry out 4500 audits this
One investor was
fined more than $12,000 for over-claiming
deductions on a holiday home because investigations revealed it
was not made genuinely available for rent.
ATO officials have
found the property was unavailable during peak holiday periods.
has had to pay back $5500 because they had not apportioned their rental
interest deduction to account for redraws on their investment loan to pay for
concerned about the extent of non-compliance in this area and will be looking
very closely at claims this year," assistant commissioner Gavin Siebert
He warned the ATO's
methods for detecting dodgy claims were becoming more advanced, and included
the use of social media and other online content to check claims.
"We use a
range of third party information including data from financial institutions,
property transactions and rental bonds from all states and territories, and
online accommodation booking platforms, in combination with sophisticated
analytics to scrutinise every tax return," Mr Siebert said.
identify claims of concern, ATO staff will investigate and prompt taxpayers to
amend unjustifiable claims. If necessary, we will commence audits," he
The proportion of
Australia's 2.2 million landlords who are negatively geared fell to 60
per cent in fiscal 2017, the lowest level since 2003,
The ATO has
nonetheless received additional federal government funding for audits and
reviews of rental properties.
"We expect to
more than double the number of in-depth audits we conduct this year to 4500,
with a specific focus on over-claimed interest, capital works claimed as
repairs, incorrect apportionment of expenses for holiday homes let out to
others, and omitted income from accommodation sharing," Mr Siebert said.
auditors begin, they may search through even more data including utilities,
tolls, social media and other online content to determine whether the taxpayer
was entitled to claims they've made," he said.
While no penalties
will apply for taxpayers who amend their returns due to genuine mistakes,
deliberate attempts to over-claim can attract penalties of up to 75 per cent of
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Friday, 19 April 2019