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Tax authorities will investigate millions of property transactions in an exercise that could have big implications for agents and their clients.
The Australian Taxation Office (ATO) has announced plans to acquire details of all property transactions since 1985, which will cover about 900 million records relating to 11.3 million individuals.
This information will come from revenue offices, lands departments and rental bond authorities in all states and territories.
The aim is to cross-check data to ensure everyone has met their tax obligations.
Intermediaries such as agents may be consulted so authorities can “obtain an understanding of the risks and issues, as well as trends of non-compliance”, according to the ATO.
“During the 2014-15 financial year, the ATO identified over 8,000 cases where real property dealings had not been treated correctly and raised an additional $161 million in revenue. This demonstrates the effectiveness of this program in protecting public revenue,” it said.
H&R Block’s director of tax communications, Mark Chapman, said this program will affect anyone who has bought, sold or rented out a property over the last 30 years.
Mr Chapman told REB that this gives agents the chance to assert their trusted adviser status by calling old clients and alerting them to the crackdown.
“Anybody who’s engaged in property transactions on a regular basis really needs to know about this, and this would be a great opportunity to bring it to their attention,” he said.
“I think the key thing is to emphasise to clients that they need to be confident that they have correctly recorded for tax purposes all of their transactions – particularly over the last four years, because that’s the period that the tax office typically chooses to review.”
Mr Chapman said agents should advise clients to consult an accountant if they are concerned about any possible errors “because the ATO has got all this information and its clearly going to start using it”.
[Related: Increase your trusted adviser status using tax depreciation]
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