ATO's audit targets

The ATO has set up a new page on its website called "Building confidence", which talks about its current compliance activities, and the amounts of tax and penalties it has collected in 2014 from its various initiatives.Some of the areas that the ATO has stated it will be focusing on are:

  • Work-related expenses:

           –     motor vehicle expenses for travelling between home and work;

           –     overnight travel; and

           –     the work-related proportion of use for computers, phones and other electronic devices.

  • Rental property expenses:

           –     excessive deductions being claimed for holiday homes (deductions should be limited to the amount of income earned, or to the number                       of days actually rented out at a commercial rate);

           –     husbands and wives inappropriately splitting rental income and deductions for jointly owned properties; and

           –     interest deductions being claimed for the private proportion of loans.

  • Cash economy:

           –     the building and construction industry; and

           –     the restaurant, café and takeaway industry.

  • Contractors – employers misusing contracting arrangements with the intention of avoiding employment overheads.