The 3 Priority Areas for the ATO this Year

1. In the ATO’s sights this Tax Time

The ATO has announced its three key focus areas for this Tax Time:‌

• rental property deductions;
• work-related expenses; and
• capital gains tax.

ATO Assistant Commissioner Tim Loh said the ATO is continuing to prioritise areas where they often see mistakes being made:

“Within these areas, we have identified common mistakes, and are particularly focused on addressing these and supporting taxpayers and registered tax agents to get their claims right this year.”

However, the ATO also recognises that many people are “doing it tough” this year, and expects fewer people will receive a refund, or they may receive smaller refunds than they were expecting, and more may have tax debts to manage.

Editor: Mr Loh also recommends that any taxpayers feeling overwhelmed, or getting behind with their tax, should let the ATO know as early as possible or “have a chat with your registered tax agent so we can work with you to find a solution. Don’t bury your head in the sand”.

‌2. ‘Side hustles’ in the ATO’s sights

Editor: A recent ATO article highlights the fact that it is increasingly trying to bring more modern techniques of money-making into its tax net . . .

‘Side hustles’ have really grown over the past few years — everything from the gig economy and drop shippers, to content creators and influencers.

The ATO recognises that it can be hard to know how to treat income when earning money from side hustles, especially when an individual has several, so the ATO has prepared some tips.

First, the individual needs to know if they are ‘in business’. If so, they may need to think about registration and tax obligations. If they are not in business, but are looking to start one, they should know how to “set themselves up for success”.

Also, if a side hustle means the individual is now a director of a company, they must make sure they apply for a director ID (which is free).

Editor: Please contact our office if you require any assistance in relation to your ‘side hustles’.

‌3. ATO ride sourcing data-matching program

The ATO will acquire ride sourcing data relating to approximately 200,000 individuals to identify individuals that may be engaged in providing ride sourcing services during the 2022/23 financial year.

The data items include:

• identification details (driver identifier, ABN, driver name, birth date, mobile phone number, email address and address); and
• transaction details (bank account details, aggregated payment details, gross fares, net amount paid to driver, and all other income to which GST may or may not apply) of all payments received in the relevant period.

The data will be used to identify and inform ride sourcing providers of their tax obligations as part of information and education campaigns.

The intelligence obtained will increase the ATO’s understanding of the behaviours and compliance profiles of individuals and businesses that provide ride sourcing services, and may also be used as part of the methodologies by which the ATO selects taxpayers for compliance activities.

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Please Note: Many of the comments in this article are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.