Australian Taxation Office Investigation of Lifestyle Assets

The ATO is obtaining information from data providers for the 2014 and 2015 financial years to identify taxpayers who held insurance policies for lifestyle assets such as marine vessels, enthusiast motor vehicles, thoroughbred racehorses, fine art and aircraft.

The ATO will match this data with income tax returns (including capital gains tax schedules), Business Activity Statements, Fringe Benefits Tax returns and self-managed superannuation fund returns. If the information reported on these returns indicates that the taxpayer might not have sufficient income to fund these lifestyle assets an audit might be triggered.

If you are one of the rare taxpayers at risk from such a tax audit, you might consider voluntary disclosure. The ATO is usually much more lenient with penalties when there is voluntary disclosures.

By one means and another the tax net continues to tighten.