Earlier this year, the ATO announced a program to help identify ‘lifestyle’ assets that it believes have not been properly accounted for or taxed.
The ATO will be utilising data from a number of insurance companies to assess and identify the owners of these assets, allowing it to formulate an opinion on taxpayers who have reported very little taxable income in their personal tax returns but who have accumulated significant lifestyle assets, HLB Mann Judd senior tax consultant Daryl Jones said.
Lifestyle assets include personal assets and collectables such as fine art, marine vessels, aircraft, enthusiast motor vehicles and thoroughbred horses.
Assets held within superannuation will be scrutinised by the ATO, and Mr Jones suggested those who are not compliant have a “significant” chance of getting caught out.
another one of the data matching programs the ATO has undertaken,” Mr Jones said, adding, “You have a high chance of being caught out. The ATO has far wider data matching capabilities than it ever has before.”
Broadly in relation to this program, information – including details of the insurance policy holder and insurance policy details – will be collected from insurance companies. It is estimated that more than 100,000 insurance policies will be obtained by the ATO.
“Where there appears to be a discrepancy, the ATO will contact taxpayers and give them the opportunity to verify the accuracy of the information prior to amending any income tax return,” Mr Jones said.
“It is therefore a good idea to revisit the insurance policy of any lifestyle assets owned to ensure that all the details are correct and information is correctly reported on financial statements and income tax returns.”