The four very specific areas the tax office is cracking down on this year

the australian tax office (ATO) has outlined four key areas it will target this fiscal year, with gains made on cryptocurrency, property and equities top of the agenda.

As tax time approaches, the ATO said this year it will focus on record keeping, work-related expenses, income from rental property, and deductions and capital gains from crypto assets. .

Assistant Commissioner Tim Loh said the ATO would target areas where people commonly make “mistakes” and urged all Australians to rethink their claims.

The ATO said record keeping would be a particular priority this fiscal time.

Of particular note is how Australians invest in – and deduct – the costs associated with cryptocurrency.

If Australians had an asset such as property, shares, cryptocurrency or even a non-fungible token (NFT), they will need to calculate a capital gain or loss and record it on their return.

“Crypto is a popular type of asset and we expect to see more capital gains or losses reported on tax returns this year. Remember that you cannot offset your crypto losses with your salary. and your wages,” Loh said.

“Through our data collection processes, we know that many Australians are buying, selling or trading coins and digital assets, so it’s important that people understand what this means for their tax obligations.”

Each time an asset is discharged, a capital gain or loss must be calculated. (Stock)

He advised Australians to start thinking about their tax now to avoid the stress – or financial penalty – of filing late or incorrectly.

“We know there are still a few weeks to go until tax time, but if you start organizing the records of income and deductions that you have kept throughout the year, it will ensure a smoother and more efficient tax time. will ensure you claim the deductions you are entitled to,” says Lo.

The assistant commissioner said each claim must meet the “three golden rules” of tax, meaning you must have spent the money yourself and not been refunded, you can only claim the labor portion of an expense and you must have a record to prove it.

Thousands of Australians have sold property in the housing market boom of 2021-22. (Peter Rae)

The slow easing of COVID-19 restrictions means the ATO also expects deductions for working from home to decrease this year.

“Some people have moved to a hybrid working environment since the start of the pandemic, which saw one in three Australians report working from home on their tax returns last year,” Loh said.

“If you have continued to work from home, we expect a corresponding reduction in car, clothing and other work-related expenses such as parking and tolls.

“Each individual’s work-related expenses are unique to their circumstances.

“If your working conditions have changed, don’t just copy and paste your reimbursement claims from the previous year.

“If your expense was used for both business and private use, you can only claim the work-related portion of the expense.

“For example, you cannot claim 100% of cell phone expenses if you use your cell phone to call mom and dad.”

The ATO said it is cracking down on incorrect declarations to make the system fairer for every taxpayer. (PAA)

Those who cringe to have their tax return in their bank account are also being asked to wait until the pre-filling has been done on their account, which is usually finished at the end of July.

Pre-populated information – which includes interest from banks, dividend income, private health insurers and more – generally avoids errors or missed deductions when entering all income manually.

“You can check whether your employer has marked your tax return as ‘tax ready’ as well as whether your pre-fill is available in myTax before filing. This way an amendment does not need to be made later, which could result in delays in your refund,” Loh said.

“While we receive and compare extensive information about rental income, foreign source income, and capital gains events involving stocks, crypto assets, or property, we do not pre-populate all of this information for you.”

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The information provided on this website is of a general nature only and does not constitute personal financial advice. The information has been prepared without taking into account your personal objectives, financial situation or needs. Before acting on any information on this website, you should consider the suitability of the information to your objectives, financial situation and needs.

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