At the end of last year the ATO began cracking down on tax dodgers by demanding information from 30 insurance companies about their wealthy customers during the past five years.
Insurers were instructed to provide policy information on assets that met these thresholds:
- Aircraft: $150,000
- Marine vessels: $100,000
- Fine art: $100,000 per item
- Motor vehicles: $65,000
- Thoroughbred horses: $65,000
“If a taxpayer is reporting a taxable income of $70,000 to us but we know they own a $3m yacht then this is likely to raise some red flags,” ATO deputy commissioner Deborah Jenkins, said.
The tax office is targeting 350,000 taxpayers, with particular attention on high net worth taxpayers who had not declared capital gains on certain assets, such as paintings and sculptures.
The information provided will also help expose people who claimed GST on assets that were used for personal purposes or bought expensive items through their self-managed super funds under the pretence of an investment.
Only assets owned since July 2015 will be traced, as the ATO already has data on the two previous financial years.
Anyone who suspects they have not complied with their tax or superannuation obligations will likely receive reduced penalties if they proactively bring their situation to the attention of the ATO.
