The ATO says 90% of property investors have made mistakes in their tax returns and it is cracking down this coming year.
May 29th, 2023 Posted by Gobbill Financial Management, Property, Time Management 0 thoughts on “The ATO says 90% of property investors have made mistakes in their tax returns and it is cracking down this coming year.”The Australian Taxation Office (ATO) is on the move to crack down on landlords that incorrectly claim or omit items for investment properties on their tax return. The ATO found nearly 9 out 10 landlords making various mistakes such as submitting incorrect claimed expenses and rental income.
Assistant tax commissioner Tim Loh said the Tax Office was targeting areas where people often made mistakes on their returns such as leaving out rental income and overclaiming expenses. “We encourage rental property owners and their registered tax agents to take extra care this tax time and review their records before lodging their return,” Loh said.
Not having the eligible expenses digitally stored and correctly categorised in one place is a big hassle when it comes to tax time.
Senior Accountant Anthony Fernando from Xantias financial management says that he sees this all the time while he assists many clients with their tax returns. “Clients are time poor and need to collate all their expenses for claims. They also need to be aware of what expenses are claimable as per ATO’s standards. A good tax accountant can guide you through.”
It takes a lot of time and effort to pay bills relating to investment properties and keep on top of records for expenses. Maintaining proper records is important to calculate and substantiate your deductions.
An Australian technology company called Gobbill has been helping property and business owners over the last 5 years. The system automatically does the data entry of bills, check for any fraud/scams, pays the bill before the due date and allocates the bill to correct property (or entity) after the initial setup. This helps property investors to avoid errors, save them a lot of time throughout the year and remove the hassle of finding eligible claims at tax time.
Gobbill is a solution used by many Australian property investors to organise and automate all their bill payments, then store in one place the relevant expense claims. It removes the hassle of finding all the expenses when it comes to tax time. Our clients just export a file for their accountant which also contains all the information required including the associated property/entity for the bill.
Contact Gobbill to find out more about paying and tracking investment property expenses https://gobbill.com/contact/ or email [email protected]
Contact Xantias to find out more about financial management https://www.xantias.com.au/contact/ or email afernando@xantias.com.au
#taxtime #eofy #accounting #propertyinvestment #tax
Sources:
1) Sydney Morning Herald, April 2023 – Landlords asked to explain $1.3 billion tax shortfall in new ATO blitz: https://www.smh.com.au/money/planning-and-budgeting/landlords-asked-to-explain-1-3-billion-tax-shortfall-in-new-ato-blitz-20230414-p5d0fp.html
2) Australian Financial Review, April 2023 – How ATO crackdown is targeting your investment property: https://www.afr.com/wealth/personal-finance/how-ato-crackdown-is-targeting-your-investment-property-20230419-p5d1nt
3) The Australian Taxation Office: https://www.ato.gov.au/Individuals/Investments-and-assets/Residential-rental-properties/rental-expenses-to-claim/
4) The Australian Taxation Office: https://www.ato.gov.au/general/interest-and-penalties/penalties/statements-and-positions-that-are-not-reasonably-arguable/
5) The Guardian, April 2023 – Australian Taxation Office to force banks to hand over landlord data in investment property crackdown: https://www.theguardian.com/australia-news/2023/apr/12/australian-tax-office-force-banks-hand-over-landlord-data-investment-property-crackdown
