ATO’s Enhanced Data Matching
The ATO is ramping up its data matching capabilities to ensure accurate reporting of income and deductions this tax season. They will have access to information from various sources, including property managers, financial institutions, sharing economy platforms, and income protection policies.
ATO Assistant Commissioner, Tim Loh, emphasized that these expanded capabilities will help identify genuine taxpayers and those providing incorrect information. The data matching programs will uncover gaps, omissions and inflations, ensuring accurate tax returns.
To improve accuracy, the ATO will educate taxpayers about incorrect claims and work towards pre-filling more information in the future. Rental property owners, in particular, will benefit from the additional data matching capabilities, which will address issues related to interest deductions on loans.
With the new landlord insurance data-matching capabilities, the ATO is reminding taxpayers you can claim insurance premiums for rental properties, but any payouts must be reported as income. It’s crucial to be honest with your tax agents when preparing your returns, especially for the 87% of rental property owners who use tax agents.
Starting from 1 July 2023, the Sharing Economy Reporting Regime (SERR) will require electronic distribution platforms to report payment information to the ATO. This aims to capture income earned through side hustles and share economy activities.
The ATO’s greater data matching capabilities also extend to income protection insurance, tracking premiums paid and payouts received with the ATO again reminding taxpayers you can’t claim the deduction if the insurance policy is paid by your super fund.
More details about the ATO’s data matching capabilities can be found here.
Rest assured, the ATO is committed to ensuring fairness during tax time. They are here to help individuals get their tax returns right the first time. Let’s make accurate reporting a priority this year.
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