Each year the Australian Tax Office identifies different focus areas to zero in on when assessing tax returns.
These are often elements of a return that are easy to make mistakes with or inadvertently overlook. "The ATO is targeting problem areas where we see people making mistakes," Assistant Commissioner Tim Loh explained.
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Information provided by the ATO shows that in 2020-21, $22.3 million in penalties were levied against 2218 individual taxpayers, with the most common penalty reasons being "intentional disregard of a taxation law, recklessness, and failure to take reasonable care".
With the shift to remote and work-from-home arrangements, plus the rise in cryptocurrency investing, it's no surprise the ATO will be paying close attention to these. This year's focus is on record-keeping; work-related expenses; rental property income and deductions; capital gains from crypto assets, property, shares.
The ATO advised taxpayers to keep accurate records of work-related expenses, rental property income, and deductions and capital gains from investments to avoid getting caught out with incorrect or incomplete information when it comes time to lodge their tax returns.
[We] will be taking firm action to deal with these taxpayers who are gaining an unfair advantage...
- Australian Tax Office
Using apps to track expenses, such as MyDeductions in the ATO app, can help ensure accurate and complete information for tax time. Using MyDeductions to record expenses and the ATO app to lodge a return, plus waiting until pre-fill information about income, interest and investments has populated in your myTax account, can make lodgment easier.
"You can check if your employer has marked your income statement as 'tax ready' and if your pre-fill is available in myTax before you lodge. That way, an amendment doesn't need to be made later, which could result in delays to your refund," Mr Loh said. "While we receive and match a lot of information on rental income, foreign-sourced income and capital gains events involving shares, crypto assets or property, we don't pre-fill all that information."
The ATO has a warning for anyone who deliberately tries to increase their refund or falsify records. "[We] will be taking firm action to deal with these taxpayers who are gaining an unfair advantage over the rest of the Australian community who are doing the right thing."
