Four things the ATO will be closely examining this tax season

As the end of the financial year approaches, the Australian Taxation Office (ATO) is focusing on
cryptocurrency gains, work-from-home deductions, rental income, and record keeping.
As we near the end of the second full financial year in a hybrid working environment, assistant
commissioner Tim Loh cautioned taxpayers that their tax returns may differ from those filed before
the pandemic.

“Since the beginning of the pandemic, some individuals have adopted a hybrid working
environment, with one in three Australians claiming working from home expenditures on their tax
returns last year,” he stated.

If you’ve continued to work from home, we anticipate a reduction in vehicle, clothing, and other
work-related expenses such as parking and tolls.

Loh continued by stating that there are three golden rules to consider when filing tax returns.

The expense was not repaid by the taxpayer’s employer; 2. The expense is divided between work
and personal use (with personal use not being tax deductible); 3. The taxpayer has documentation to
substantiate it.

“For instance, you cannot claim 100 percent of your mobile phone charges if you use it to call your
parents,” Loh noted.

And there’s no time like the present to get started on your tax return, Loh says, as common last-
minute mistakes include taxpayers forgetting to include bank account interest, dividend income, and
payments from other government agencies and private health insurance companies.

“We are aware that there are still a few weeks until tax season, but if you begin organising the
income and deductions records you’ve kept throughout the year, this will guarantee an easier tax
season and ensure that you claim the deductions to which you are entitled,” he said.

With the rise in popularity of cryptocurrencies over the past year, taxpayers have been advised that
any capital gains or capital losses from coins or a crypto asset such as non-fungible tokens must be
reported on their tax return.

The Australian Taxation Office estimates that between 500,000 and 1,000,000 Australians have
exchanged cryptocurrencies to date.

“Remember that you cannot deduct cryptocurrency losses from your pay and wages,” Loh stated.
And the ATO will maintain track of the purchase and sale of digital currency and assets using data
collecting techniques.

Indeed, taxpayers attempting to defraud the system in order to boost their return (by, for example,
fabricating records or submitting spurious claims) have been cautioned that severe penalties apply.

It follows the ATO’s confirmation last week that it was investigating a $850 million GST refund
scheme in which over 40,000 taxpayers claimed GST refunds for non-existent firms.

Taxes can be difficult. If you are unsure, please Contact us on (07) 3804 7575 to make a booking to
discuss your needs and even better, our fee tax deductible.