This article is for general information purposes only and reflects the state of information at the time of publication. It is not legal or financial advice. Always seek professional advice tailored to your specific circumstances before making decisions.
ATO Data Matching: What It Means for Property Investors and the Sharing Economy
The Australian Taxation Office (ATO) are stepping up their game with a major expansion in data matching capabilities. What’s on their radar? Well, they’re keeping a close eye on residential investment property loans, landlord insurance, income protection insurance, and they’re even rolling out something called the Sharing Economy Reporting Regime (SERR).
What’s the big deal, you ask?
The ATO is on a mission to make sure no one’s skipping out on declaring income or padding their deductions on their tax returns. So, they’re tapping into property managers, diving into landlord insurance policy details (yes, including the nitty-gritty of premiums and claims), digging into investment loan data, and tuning in to sharing economy providers. And guess what? They’re planning to use this data to fill in parts of your tax return for you. Talk about staying one step ahead!
Now, let’s zoom in.
When it comes to residential investment property loans and landlord insurance, the ATO is all about making sure your claims for loan interest match up with the real deal – no funny business with private or personal purchases. They’re waving the flag for deductibility only when the interest lines up with the original financing for your rental property or when you’re making structural improvements or repairs.
Don’t think you can sneak by with income protection insurance either.
The ATO’s got its hands on data about the premiums you’re paying and the payouts you’re receiving. Keep in mind, if you’re getting a payout from either your personal insurance policy or your super fund policy, you’ll need to work that into your tax return.
Sharing Economy Reporting Regime (SERR)
Hold onto your hats, because the Sharing Economy Reporting Regime (SERR) has rolled in, starting from July 2023. This means more electronic platforms need to dish out payment info to the ATO. Taxi services, ride-sourcing, and short-term accommodation are already in the loop, with others hopping on board by July 2024. The ATO will be playing matchmaker, comparing platform data with what you’ve got on your tax returns.
Turning your home into Airbnb or Stayz
Heads up for those turning their homes into income generators on platforms like Airbnb or Stayz. The ATO’s giving your capital gains tax exemptions a thorough look. If you’re using your main residence for income, they’re keeping tabs. It’s a good idea to have a chat with an advisor to get the scoop on strategies before you dive in.
For the full scoop, check out the ATO website. Stay ahead of the tax game!
