The ATO Data Matching System – what’s new in 2024 and where is the ATO focused?

I’m sure everyone reading this article will have seen, at some point, a news article or commentary about the ATO being focused on a particular aspect of tax for the 2024 Tax Season. So far, most media attention has been on the usual post covid working from home claims along with some noise about Crypto Assets and Rental Properties. This is standard for this time of year as the ATO ramps up for the first round of Tax Season and tries to pre-warn taxpayers to be careful.

What’s more interesting is where the ATO has established new connections for their data-matching program and what information they are obtaining from this. Alot of these new connections aren’t being reported on and aren’t well publicised but nonetheless spotlight potential future audit activities by the ATO.

What’s old this year?

The ATO is compelling cryptocurrency designated service providers to provide records from the 2014-2015 year through to the 2019-2020 financial year. So if you have Crypto Assets the ATO is very slowly catching up with data on what’s been going on in prior years.

You can expect the usual data-matching with all of the Gig Economy which includes everything from Airbnb to Uber and on rental property data.

These are the usual targets for ATO data matching to try and make sure people are reporting all of their income. But there are some new and interesting sources for 2024.

What’s new (is old again)!

You would expect that the ATO’s systems are well linked in with other Government Departments to match data with them. Not necessarily! One of the new data-links for the 2024 year is with Services Australia where the ATO is seeking to match income data from Services Australia with what is reported to the ATO in Tax Returns. The ATO is primarily focused on ensuring Medicare Levy Surcharge and Exemptions are bring properly reported but you can expect other compliance activities to come from this.

One of the more interesting new connections is between the ATO and the State Government administered Rental Bond Boards. This will allow the ATO to be able to glean when rental bonds are taken and released and, if they are released to landlords, match this to the landlords Tax Returns. While there is a general focus on rental properties every year the ATO is particularly focused on ensuring that landlords who receive payments of rental bonds report these as income in their Tax Returns.

The other interesting new connection is between the ATO and the major providers of Novated Car Leases. While the ATO has maintained a close connection with the State Vehicle Registration Bodies over the past few years, the focus on Novated Leasing Providers and on Vehicles registered in business names is reflective of the increased ATO focus on Fringe Benefits Tax, (“FBT”), and on closing the “Tax Gap” on FBT.

The Takeaway

When you sit down and prepare your tax documents for 2024, be aware that it is very likely that the ATO already has a fair idea of both what your income is and where your income comes. As you plan your deductions you should know that documentation and substantiation win the day if it comes to an ATO review. The more of that you have, the better your position will be when and if the ATO comes knocking.

Author

Scott Hogan-Smith – Director & Chartered Accountant

This article first appeared in the September 2024 issues of the News Bulletin, published by the Australian Dental Association https://www.ada.org.au/Dental-Professionals/Publications/News-Bulletin

This article is designed to provide generic information only and should not be viewed as a recommendation to act or financial advice. Individuals should seek advice from a qualified adviser to ensure their actions are commensurate with their financial needs and requirements. Whilst every effort has been undertaken to ensure accuracy of information at the time of publication, the information contained within the article may have changed prior to and subsequent to the article’s publication.

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