Think about lodged returns as if they are stones which are skipped into a river once lodged. Historically the Australian Taxation Office (ATO) would fish out these stones haphazardly with a net, which were amidst an abundance of water and other stones.
Now, imagine that the river has dried up. This makes it a lot easier to identify each stone. In fact, better clarity would encourage closer inspection of each stone.
Thanks to refined data matching technology, these days the ATO is more agile in deciphering information and ‘drying up the river’. Earlier in 2016 the ATO cautioned that it has more than a staggering 600 million pieces of third-party data to track activity and income.
Lodged returns can be accurate and still receive further inspection by the ATO or other relevant government revenue agencies. These bodies have made it their mission to ensure that they are thoroughly reviewing the tax affairs of all Australian individuals, business and SMSFs. In particular we are seeing the ATO is currently focussed on:
- Further targeting of large private groups and HWIs
- Reviewing the sharing economy
- Real time data through the introduction of SuperStream (this will result in more Super Guarantee audits)
Even if no adjustments are required to your lodged returns, significant costs can still be incurred in order to satisfy the requests of the ATO or other government revenue agencies instigating the audit, enquiry, investigation or review.
To find out how you can be protected against the ramifications of audit activity, talk to us about our optional Audit Shield service.