Australian Tax Office cracking down on holiday home owners wrongly claiming deductions

ABC News
March 28 2018


The Australian Tax Office (ATO) warns it is cracking down on rental home owners who wrongly claim tax deductions on properties they are using for their own personal holidays.
Is your property genuinely available to rent? The ATO says:



The ATO's assistant tax commissioner Kath Anderson said too many holiday home owners were claiming deductions for properties which were not genuinely available for rent or were only available to friends and family.   :(

"While private use of a property is entirely legitimate, you can't claim tax deductions for that period," she said.

    "What's actually happening here is that the rest of us are effectively subsidising their holidays and their holiday homes."

Ms Anderson said in one case a man who owned a property on Victoria's Mornington Peninsula claimed $760,000 in deductions for a property used by either himself or family and friends for 87 per cent of the year.   :(

"That included it being blocked out for their use in peak periods," she said.

The man declared earning $27,000 income from the property, which Ms Anderson said was not reasonable, given the huge amount he claimed in deductions.
What can property owners claim as deductions?


The types of deductions property owners can claim include money they spend on repairs and maintenance, cleaning and rates.

Ms Anderson confirmed many rental home owners also negatively geared their properties.

"About 80 per cent of taxpayers with rental properties claim interest on their loan and it makes up nearly half of all rental expenses," she said.

She said the ATO's crackdown extended beyond holiday homes to the general rental market.

Ms Anderson said some taxpayers claimed their property was available for rent, but when the ATO investigated it was clear they have had very little intention of renting it out.

"We're seeing people not bothering to advertise or advertising in an obscure way," she said.

"We see things like unreasonable conditions placed on prospective renters, rental rates set above market rates."
ATO to use data matching to track rorters


The ATO warns it will use new technology and data matching to identify taxpayers who make incorrect or false claims.

"Where something raises a red flag, it will be investigated," she said.

"Property owners whose claims are disproportionate to the income received can expect scrutiny from the ATO."

H&R Block director of tax communications Mark Chapman said the ATO's threat was not empty, and technological advances had made it simple to track people doing the wrong thing.

    "If you're saying that your holiday rental was available for rent, the ATO can google that or they can look on one of the commercial websites," Mr Chapman said.

    "And if the property isn't there, or … there are lots of dates blocked out … that immediately throws into question your claims."

"There are over two million Australians who have rental properties of one sort or another and what the tax office has been telling us for sometime is that they see a pattern of people claiming deductions that they're not entitled to."   :(

He said any reputable tax adviser would not allow their clients to make such claims.

Ms Anderson said the penalties for incorrect claims varied but the maximum was 75 per cent of the shortfall between what was paid and what was actually owed

Greed work in strange ways.
Throw the book at them. Costing me money for "their" portfolio.
I hope no one is exempt from the investigation.....but I doubt that to be the case.

"She said the ATO's crackdown extended beyond holiday homes to the general rental market."

Excellent news.

greggerypeccary wrote on Mar 28^th, 2018 at 7:48am:

"She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news.

I hope that is the case.
There would be a few politicians fudging books as we type.... ;D

Captain Caveman wrote on Mar 28^th, 2018 at 7:52am:

greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D

Yep.

Politicians, mums & dads, all sorts of people.

I often hear people bragging about these dodgy tax deductions, and secretly wish that they'd get busted.

Maybe a few of 'em will now.

Where there's an open door, many will stroll through it and stroll back out again carrying the silver... that's the way this nation has gone, I'm afraid.

Captain Caveman wrote on Mar 28^th, 2018 at 7:52am:

greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D

A very good point - the 'second home' in Cambra would seem to be in the firing line.  I note the term 'family' use - will they make it retrospective and apply it to politicians staying in a 'family' home in Cambra etc?

Oh - that old saw - 'it's within the rules'.... oh, yes, of course it is...

greggerypeccary wrote on Mar 28^th, 2018 at 7:57am:

Captain Caveman wrote on Mar 28th, 2018 at 7:52am: greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D Yep. Politicians, mums & dads, all sorts of people. I often hear people bragging about these dodgy tax deductions, and secretly wish that they'd get busted. Maybe a few of 'em will now.

I love it when snakes and liars and thieves get their own back.  Seems to come around, but Oh, Lord - how long sometimes?

This should have been closed off from day one..... it seems the Millennial Dragon is awakening slowly to the wiles of evil men.....

(damn - that's what happens to your mind when you re-visit the likes of Ray Bradbury after a few years or decades)....

Sir Grappler Truth Teller OAM wrote on Mar 28^th, 2018 at 8:54am:

Captain Caveman wrote on Mar 28th, 2018 at 7:52am: greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D A very good point - the 'second home' in Cambra would seem to be in the firing line.  I note the term 'family' use - will they make it retrospective and apply it to politicians staying in a 'family' home in Cambra etc? Oh - that old saw - 'it's within the rules'.... oh, yes, of course it is...

I didn't know the politicians rented out the "family" in home in Canberra.  But if so good for the ATO.

lee wrote on Mar 28^th, 2018 at 11:23am:

Sir Grappler Truth Teller OAM wrote on Mar 28th, 2018 at 8:54am: Captain Caveman wrote on Mar 28th, 2018 at 7:52am: greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D A very good point - the 'second home' in Cambra would seem to be in the firing line.  I note the term 'family' use - will they make it retrospective and apply it to politicians staying in a 'family' home in Cambra etc? Oh - that old saw - 'it's within the rules'.... oh, yes, of course it is... I didn't know the politicians rented out the "family" in home in Canberra.  But if so good for the ATO.

Our old mate Fat Joe turned it into an art form - he stayed at full taxpayer expense in a unit owned by his missus, which was paid for out of his untaxed sustenance money while in Cambra.  And all this time I thought all these politicians were doing so well on the outside they sacrificed to go into 'public service' - couldn't have been doing THAT well in reality, most of them.

Is it even too much for them to even suggest that they go to a PARTY meeting without filleting the taxpayer, as Slim Tony has been given carte blanche to do in the wording of Mal's travel rorts offer to him - "to attend any function as ex PM" (meaning every goddamned party gig is paid for by YOU).

Bloody ATO - why don't they just let the elected government govern instead of doing their duty as a PUBLIC service?  Why can't the government just govern as they wish without all this hindrance from Senates, Oppositions, and (gasps) public servants?

Who knows where it could lead?  Consider the children.....

Sir Grappler Truth Teller OAM wrote on Mar 28^th, 2018 at 12:03pm:

lee wrote on Mar 28th, 2018 at 11:23am: Sir Grappler Truth Teller OAM wrote on Mar 28th, 2018 at 8:54am: Captain Caveman wrote on Mar 28th, 2018 at 7:52am: greggerypeccary wrote on Mar 28th, 2018 at 7:48am: "She said the ATO's crackdown extended beyond holiday homes to the general rental market." Excellent news. I hope that is the case. There would be a few politicians fudging books as we type.... ;D A very good point - the 'second home' in Cambra would seem to be in the firing line.  I note the term 'family' use - will they make it retrospective and apply it to politicians staying in a 'family' home in Cambra etc? Oh - that old saw - 'it's within the rules'.... oh, yes, of course it is... I didn't know the politicians rented out the "family" in home in Canberra.  But if so good for the ATO. Our old mate Fat Joe turned it into an art form - he stayed at full taxpayer expense in a unit owned by his missus, which was paid for out of his untaxed sustenance money while in Cambra.  And all this time I thought all these politicians were doing so well on the outside they sacrificed to go into 'public service' - couldn't have been doing THAT well in reality, most of them. Is it even too much for them to even suggest that they go to a PARTY meeting without filleting the taxpayer, as Slim Tony has been given carte blanche to do in the wording of Mal's travel rorts offer to him - "to attend any function as ex PM" (meaning every goddamned party gig is paid for by YOU). Bloody ATO - why don't they just let the elected government govern instead of doing their duty as a PUBLIC service?  Why can't the government just govern as they wish without all this hindrance from Senates, Oppositions, and (gasps) public servants? Who knows where it could lead?  Consider the children.....

https://independentaustralia.net/_lib/slir/w600-h900/https://independentaustralia.net/i/article/img/article-7816-hero.jpg

Sir Grappler Truth Teller OAM wrote on Mar 28^th, 2018 at 12:03pm:

Our old mate Fat Joe turned it into an art form - he stayed at full taxpayer expense in a unit owned by his missus, which was paid for out of his untaxed sustenance money while in Cambra.

So the unit was rented out to him, by his wife? Did she declare the income?

If it was not a commercial rate of rent for the area then the tax office cracks down on that.

If it is only tenanted by a third party for part of the year that has to be accounted for. A holiday home perhaps.

http://cdn.mamamia.com.au/wp/wp-content/uploads/2015/06/jh11.png

greggerypeccary wrote on Mar 28^th, 2018 at 12:43pm:

http://cdn.mamamia.com.au/wp/wp-content/uploads/2015/06/jh11.png

Wow. tell us how that relates to an ATO crackdown gweggy. ;D ;D ;D ;D ;D ;D ;D

lee wrote on Mar 28^th, 2018 at 12:41pm:

Sir Grappler Truth Teller OAM wrote on Mar 28th, 2018 at 12:03pm: Our old mate Fat Joe turned it into an art form - he stayed at full taxpayer expense in a unit owned by his missus, which was paid for out of his untaxed sustenance money while in Cambra. So the unit was rented out to him, by his wife? Did she declare the income? If it was not a commercial rate of rent for the area then the tax office cracks down on that. If it is only tenanted by a third party for part of the year that has to be accounted for. A holiday home perhaps.

He was co-habiting in a family owned residence.....

I'll be back :D LOL

---

Sir Grappler Truth Teller OAM wrote on Mar 28^th, 2018 at 8:52am:

Where there's an open door, many will stroll through it and stroll back out again carrying the silver... that's the way this nation has gone, I'm afraid.

   greed greed and more greed...

pot calling kettle..

this is from 2015. >:( >:( >:(


The opposition’s efforts to keep alive its politics-of-envy barrage in an attempt to tarnish Mr Turnbull’s image ignores the lifestyles enjoyed by Labor’s elite. While the wealth of individual Labor MPs is not in the stratosphere of Mr Turnbull’s self-made millions, the parliamentary salaries of four Labor frontbenchers who have joined the class-war assault — Ms Plibersek, Mr Dreyfus, Tony Burke and Andrew Leigh — mean they fall within the top 1 per cent of taxpayers.

Bill Shorten, who earns $360,990 a year and owns the family’s $842,000 home in Melbourne’s Moonee Ponds, takes home significantly more than the average worker on $79,767 a year.

His wife Chloe Shorten owns shares in Westpac and has a cash trust account at Goldman Sachs.

READ MORE
Shorten’s past is a growing threatBRAD NORINGTON
Last year she started work at Calibre Group as head of corporate affairs, but she wasn’t among executives whose pay was disclosed in the engineering company’s annual report.

Mrs Shorten’s father, Michael Bryce, is a successful businessman, running a graphic-design company that designed the Sydney 2000 Olympics logo. He wound up the business in 2010, during his wife Quentin’s time as governor-general.

Ms Plibersek’s salary is $307,329 and her husband, ­Michael Coutts-Trotter, takes home $532,300 as the head of the NSW Department of Family and Community Services.

Labor’s foreign affairs spokeswoman accused the Coalition of engaging in a “pattern of supporting tax avoidance of multinational companies’’ and “reducing the transparency around people’s private companies with turnovers more than a hundred million’’ while Mr Turnbull was “investing in a notorious tax haven”.

“We’ve got a Prime Minister buying into schemes that have a million-dollar US minimum buy-in, in a notorious tax haven and he’s trying to say, ‘oh look, I’m just like everybody else — we all do it’. I just think it is extraordinarily out of touch.”

For many Labor MPs, who rose through trade union or party positions, their taxpayer-funded incomes and entitlements are substantial. Tony Burke, as leader of opposition business, earns $248,790; other Labor frontbenchers earn $243,912 a year.

Unlike many of his colleagues Mr Dreyfus entered parliament later in life after a lucrative career in the law. The former Labor-aligned QC, who would have earned about $8000 a day at the Victorian Bar before entering parliament in 2007, made it on to BRW’s rich list of politicians back in 2010. He was placed fifth behind Mr Turnbull, Kevin Rudd, Joe Hockey, and former Liberal MP Barry Haase. Five years ago BRW estimated his private wealth at $4.2 million in shares and property.

Canny buying has built the Dreyfus family a property portfolio likely to be worth millions.

Mr Dreyfus and his wife, Deborah Chemke, own a family home in the Melbourne suburb of Malvern, which they bought for $268,500 in 1988.

They also own a unit and a carpark in a red-brick block of flats in South Yarra, bought for $686,500 in late 2013.

Ms Chemke’s investments include half of a vacant block of land in nearby Camberwell with another woman, purchased from Mr Dreyfus’s father, composer George Dreyfus, for $150,000 in 2010, and a property close to the beach in the Victorian surf coast town Aireys Inlet, bought for $591,000 in 2006. She is also a director of the Chemke family’s metals trading company, Unimet.

Through his Kenley Dale self-managed super fund, Mr Dreyfus has stakes in 18 funds, including one run by Mr Turnbull’s old employer, Goldmans Sachs.

The Goldman Sachs Australian Infrastructure Fund is one of four in which Mr Dreyfus has a stake that describes itself as “wholesale” — a term that usually limits investment to people with net assets of more than $2.5m or income of at least $250,000 a year. A minimum initial subscription of $50,000 is required to buy units in the fund, which invests in infrastructure companies.

In 2010, Mr Dreyfus told parliament he had investments in the GVI Global Industrial Share Fund. The fund requires a minimum initial $500,000 investment. He no longer uses the fund.

Labor senator Sam Dastyari kicked off the attack on Mr Turnbull in the Senate on Wednesday, saying the only reason people invested in the Cayman Islands was “so they do not have to play by the same rules as the rest of us’’.

“This is not fair, and it is not right,’’ he said.

Senator Dastyari and his wife Helen, who works for the Australian Prudential Regulation Authority, bought the family home in Sydney’s inner-west suburb of Five Dock for $1.36m in 2012. She also owns an investment property in Cammeray, on the north shore, purchased for $447,500 in 2006.

Sir Grappler Truth Teller OAM wrote on Mar 28^th, 2018 at 10:08pm:

lee wrote on Mar 28th, 2018 at 12:41pm: Sir Grappler Truth Teller OAM wrote on Mar 28th, 2018 at 12:03pm: Our old mate Fat Joe turned it into an art form - he stayed at full taxpayer expense in a unit owned by his missus, which was paid for out of his untaxed sustenance money while in Cambra. So the unit was rented out to him, by his wife? Did she declare the income? If it was not a commercial rate of rent for the area then the tax office cracks down on that. If it is only tenanted by a third party for part of the year that has to be accounted for. A holiday home perhaps. He was co-habiting in a family owned residence.....

And what does that have to do with an ATO crackdown on rentals?