ATO Assistant Commissioner Tim Loh has said the ATO is continuing to prioritise areas where they see mistakes:

“Within these areas, we have identified common mistakes, and are particularly focused on addressing these and supporting taxpayers and registered tax agents to get their claims right this year.”

The ATO has announced its focus for this tax time will be rental property deductions, work-related expenses, and capital gains tax.

Rental Property Deductions

The ATO advises that 90% of rental property owners are submitting tax returns where rental income has been omitted or interest over-claimed. Interest expenses, including where a loan has been used for both deductible and private expenses, will be an area of focus for the tax office.

Work-Related Expenses

The ATO is concerned that taxpayers are simply copying and pasting from last year’s work-related deductions, particularly in the case of working-from-home deductions. The tax office is expecting to see a reduction in working-from-home deductions, now that employees are returning to the office.

Capital Gains Tax

The ATO is worried capital gains for cryptocurrency, managed investments, real estate, and shares are not being declared. They will be focusing on main residence exemption claims where the residence is used to produce assessable income, such as renting out part of the property or renting through the sharing economy i.e. Airbnb.

In an attempt to ease concerns, Mr. Loh also reiterated the importance and value of liaising with your registered tax agent. He recommends that any taxpayers feeling overwhelmed should consult with their accountant to help ensure they don’t end up being in breach. If that’s you, please feel free to call our office on 02 4933 3466 and chat with one of our experienced tax professionals.