The ATO over the years has become quite adept at using information gathered from a variety of sources to identify taxpayers who are under declaring or avoiding their taxation commitments. A recent announcement reveals the latest step in this process.
The ATO has requested the last 5 years’ worth of policy information from over 30 insurance companies concerning insurance held for boats, horses, fine art, high-value motor vehicle and aircraft. The ATO will then analyse the tax returns for these policy owners to ensure their income levels justify this type of discretionary asset ownership.
The ATO believes this will lead to information on assets held by around 350,000 taxpayers and although the ATO has announced the information will not directly lead to any compliance or audit action, it will likely lead to red flags being raised for certain taxpayers.
If you need assistance or are concerned about your taxation affairs, please do not hesitate to contact us.