Bought expensive art, luxury car, horse or private boat recently?
Australian Taxation Officer assistant commissioner Tim Loh warned roughly 300,000 Australians who have made any of these pricey purchases to declare all their income at tax time, or face an audit.
“This isn't a game of Monopoly where you can roll the dice and avoid the income tax box,” Loh told ABC News.
“We're getting data from various sources, and we're using data and analytics to run eyes over the data to see if we can find information where people aren't declaring their income or overstating their deductions.”
The ATO is able to cross-reference people’s income because they also gather data from shared platforms such as Airbnb, Airtasker, rideshares like Uber, and more.
“It’s legal to receive payments in cash rather than electronically but you must report these amounts in your tax return,” she said.
“If you drive people around, do odd jobs or freelance work, rent out your car or storage space, run social media accounts or sell products, you need to declare this income in your tax return.”
But Australia’s wealthier individuals have now been put on notice as the ATO is able to obtain insurance policy information on assets like vehicles that cost upwards of $65,000.
The taxman can also access records of thoroughbred horses, marine vessels, fine art and aircraft to the value of $65,000, $100,000, $100,000 and $150,000 or upwards respectively.
The cost of items are then matched with the income the individual is receiving. And if it doesn’t check out, it’s a red flag – and the ATO investigates further.
“We're going to be asking questions pretty quickly [if] someone isn't declaring all their income in their tax return,” Loh said.
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Those over-claiming home office expenses will also be examined closely, as will rental property owners.