Property sales under scrutiny
NEWS that the Australian Tax Office is planning a scrutiny of all property sales over the past decade was greeted with disgust by one real estate agent yesterday.
The agent, who wished to remain anonymous, said: “The tax office cracking down on people during a downturn is just not constructive.
“And why haven’t they been on to it in the first place?” the agent asked.
The ATO announced this week that it will chase the states and territories for data to help it examine every property transaction going back to July 1, 1999.
The data would then be matched against taxpayer records, Tax Commissioner Michael D’Ascenzo said.
It would help the ATO ‘to identify people who may have incorrectly reported or not included capital gains tax, income or GST in their income tax and business activity statements’, Mr D’Ascenzo said.
“Surely this could have been done progressively, on an annual basis, as every sale has to be registered with the Titles Office,” the agent said.
“Announcing a crackdown is just scare tactics and on a society that is already beaten down by the global financial crisis.”
But another estate agent said the ATO ‘probably should’ conduct the retrospective investigation.
“If they’ve got the manpower, good luck to them,” he said.
Frank Brass, of tax specialists H&R Block, said the ATO had been carrying out such checks on a yearly basis for some time, but the 10-year search was something new.
“We always have to stress to clients the need for disclosure after we get a letter from the ATO like this,” Mr Brass said.
“There are often clients with some problem caused by previous non-disclosure and we help them deal with that.
“There are penalties involved and we always advise them to come clean.”
Most accountants would not comment, but asked whether it would bring in more work, Lismore’s Gaetano Astone said: “The level of inquiry from the public is largely driven by the complexity of calculating the tax implications of what could easily be considered a simple transaction, such as selling a house or car, combined with the comfort that comes from receiving advice from a highly qualified professional.”
And would it be welcomed by the profession?
“The more advanced use of technology means that this is the standard operating environment for the ATO, taxpayers and accountants,” Mr Astone said. The tax office plans to match more than 220 million records this year.