It always pays to be aware of the ATO’s focus areas for tax compliance, as ATO taxpayer reviews can be draining on your resources and any non-compliance however unintended, can result in costly penalties and interest. The ATO have recently released a publication entitled ‘Building Confidence”, which outlines its key areas of upcoming compliance focus across all taxpayer groups.
Privately owned groups will continue to be a key compliance focus, particularly in the context of perceived aggressive structuring, avoidance and abusive arrangements. The ATO’s improved information sources and data matching capabilities means taxpayers should expect ATO attention in circumstances where their key data does not align with tax returns or key business performance.
Specific tax issues that will be attracting the ATO’s attention in the coming year include:
- Capital gains tax
- Tax losses
- Eligibility for CGT concessions
- Issues involving trusts
- Tax consolidation.
Taxpayers who are seen as willing participants can expect a softer, consultative approach from ATO interactions. More aggressive taxpayers who are not meeting this standard should expect the ATO to tailor its compliance activities according to their behaviour and risk levels.