Wednesday 18 Sep 2019
*

Latest Accounting News
Hot Issues
Access to more resources and tools than most websites.
Tax Return Mistakes
SMSF advice appetite strong, says ASIC
Taxpayers confused by Scott Morrison’s $1,080 tax refund
Common STP set-up mistakes - ATO
Proposal to hold directors liable for GST set to pierce corporate veil
September 2019 - vital statistics for Australia
Tax Commissioner wants to turn black economy to ‘lighter shade of grey’
Changes to the Private Health Insurance Statement
Up to 9 in 10 ‘other’ expenses adjusted as ATO reveals dodgy claims
Downsizer Super Contribution
Tax payers to receive beefed up tax returns.
10 top global corporations since 1998
Catch-up Contributions
Life Insurance
Community tip-offs trigger ATO visits
Australia at a glance
2019: Tax Time Checklists - Individuals; Company; Trust; Partnership; and Super Funds
Small business clients need to be ready for STP by 30 September
Big four firm outlines new financial year checklist for SMSFs
Alert - Online Share Accommodation
ATO flashes warning over $7.2bn car expenses claims
Vital statistics for our great nation.
3 out of 4 tax dob-ins are about business
Tax on compensation received for inappropriate advice
‘Extra care’ crucial in avoiding ATO spotlight this tax time
ATO clears up FAQs about Single Touch Payroll
GST reporting: common errors and how to correct them
LRBAs, guarantees in need of review after property market falls
Victorian Property Valuation Cycle
Articles archive
Quarter 2 April - June 2019
Quarter 1 January - March 2019
Quarter 4 October - December 2018
Quarter 3 July - September 2018
Quarter 2 April - June 2018
Quarter 1 January - March 2018
Quarter 4 October - December 2017
Quarter 3 July - September 2017
Quarter 2 April - June 2017
Quarter 1 January - March 2017
Quarter 4 October - December 2016
Quarter 3 July - September 2016
Quarter 2 April - June 2016
Quarter 1 January - March 2016
Quarter 4 October - December 2015
Quarter 3 July - September 2015
Quarter 2 April - June 2015
Quarter 1 January - March 2015
Quarter 4 October - December 2014
Quarter 3 July - September 2014
Quarter 2 April - June 2014
Quarter 1 January - March 2014
Quarter 4 October - December 2013
Quarter 3 July - September 2013
Quarter 2 April - June 2013
Quarter 1 January - March 2013
Quarter 4 October - December 2012
Quarter 3 July - September 2012
Quarter 2 April - June 2012
Quarter 1 January - March 2012
Quarter 4 October - December 2011
Quarter 3 July - September 2011
Quarter 2 April - June 2011
Quarter 1 January - March 2011
Quarter 4 October - December 2010
Quarter 3 July - September 2010
Quarter 2 April - June 2010
Quarter 1 January - March 2010
Quarter 4 October - December 2009
Quarter 3 July - September 2009
Quarter 2 April - June 2009
Quarter 1 January - March 2009
Quarter 4 October - December 2008
Quarter 3 July - September 2008
Quarter 2 April - June 2008
Quarter 1 January - March 2008
Quarter 4 October - December 2007
Quarter 2 April - June 2007
Quarter 1 January - March 2007
Quarter 4 October - December 2006
Quarter 2 April - June 2006
Quarter 4 October - December 2005
Quarter 3 July - September 2005
Quarter 2 April - June 2005
Quarter 2 April - June 2004
Quarter 1 January - March 2004
Quarter 4 October - December 2003
Quarter 3 July - September 2003
Quarter 4 October - December 2001
ATO to double rental deduction audits to 4,500

ATO audits of rental deduction claims will double this tax time as the agency reinforces its claims that nine out of 10 deductions contained an error.



       

 

Accountants with clients who have rental properties have been warned of the ATO’s “top priority” for tax time 2019, after Commissioner Chris Jordan said that a random audit sample of returns with rental deductions found that 9 out of 10 contained an error.

 

ATO assistant commissioner Gavin Siebert said that taxpayers can expect the number of in-depth audits to more than double this year to 4,500, with a specific focus on overclaimed interest, capital works claimed as repairs, incorrect apportionment of expenses for holiday homes let out to others, and omitted income from accommodation sharing.

 

In 2017–18, the Tax Office audited over 1,500 taxpayers with rental claims and applied penalties totalling $1.3 million.

 

In one case, a taxpayer was penalised over $12,000 for overclaiming deductions for their holiday home when it was not made genuinely available for rent, including being blocked out over seasonal holiday periods.

 

Another taxpayer had to pay back $5,500 because they had not apportioned their rental interest deduction to account for redraws on their investment loan to pay for living expenses.

 

“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.

 

“Where we identify claims of concern, ATO staff will investigate and prompt taxpayers to amend unjustifiable claims. If necessary, we will commence audits.

 

“Once our 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.”

 

The key issues

 

The Tax Office will take a closer look at loan interest, whereby some taxpayers have been using some of the loan money for personal use such as paying for living expenses, buying a boat or going on a holiday and then claiming that loan interest as a deduction.

 

Rental property owners have also been warned on properly differentiating between capital works and repairs, and what is deductible immediately or over a number of years.

 

The correct apportioning of holiday homes being let out to family or friends below market rates will also be scrutinised.

 

This week, the ATO also reminded tax agents that the ability to claim travel to residential rental properties was no longer allowed, ever since rules changed from 1 July 2017.

 

 

 

Jotham Lian 
18 April 2019 
accountantsdaily.cpom.au

 

 



13th-May-2019
        
89 Boronia Road Boronia Vic 3155 Phone: (03) 9762 5400 Fax: (03) 9761 1327