Rental property owners to remain under scrutiny as ATO cracks down on taxpayers who either fail to meet their lodgement obligations or misreport rental information.
The rental bond data matching program has been expanded under which the rental bond details of around 2.2 million individuals will be collected by the ATO, this comes after the property management data matching program was extended in August 2024 to include the 2025-26 financial year.
To regulate the rental sector, ATO first commenced collecting rental bond information in 2005, with data collected dating back to 1985.
The main focus of these data-matching programs is to:
identify and educate individuals and businesses who may not be lodging their income tax returns, not correctly reporting assessable income from a rental property, not correctly reporting associated rental deductions and not complying with capital gains tax obligations for properties used to derive rental income
gain insights to help develop and implement strategies, which may include educational or compliance activities for individuals and businesses who lease or let real property, and
promote voluntary compliance and increase community confidence in the integrity of the tax and superannuation systems.
Errors that the ATO will be on the look-out for may include:
omission of rental income if you held more than one property
situations where the rental income declared in tax returns are not at the same proportion as the ownership documents
claiming an outright deduction for an asset that may have needed to be claimed over multiple years, and
Incorrect cost base elements when calculating the rental property’s net capital gain or loss (for a capital gain event).
Our focus is to ensure your accurate and timely compliance along with the best possible tax outcome, If you think there may have been misreporting of rental information in any of your previous tax returns, we can assist you in amending those tax returns.
If you have any questions about these data-matching programs or would like to review your arrangements, please contact The Neill Family Group.
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