ATO Focus Areas 2022

The ATO has indicated that they will be focusing on the following areas this year.
– Work Related Expenses
– Rental Property Deductions
– Crypto Currency
– Record-keeping

What does this mean for me
When claiming deductions
* you must have incurred the cost and not been reimbursed for it,
* can only claim the portion that relates to earning income,
* must have supporting documents to prove it.

The ATO will be taking firm action against those claiming deductions their not entitled to, giving an unfair advantage to others who are doing the right thing.

When preparing your return
Remember to include;
– interest received from the bank,
– dividends,
– payments from other government agencies,
– private health insurance

Most of these details will be available in your tax return as prefilled data at the end of July 2022. To ensure a smooth process the ATO encourages tax payers to check if their return has been marked as “tax ready” before submitting. You can do this by either using the ATO app or by confirming with your tax agent.

Work Related Expenses
When claiming work related expenses, ensure you account for any change in your working arrangement during the year. For example if you worked from home more during the 2022 tax year there is anticipation that other work related cost may reduce like travel or clothing cost.

A good measure to take is to use the myDeductions tool to keep an electronic copy of your supporting documents.

Rental Income and Deductions
Ensure you include all income received from your rental property in your tax return.

This includes income received from
– short-term rental arrangements such as Airbnb, Vrbo or booking.com. 
– insurance claims
– rental bonds.

The key here would be to keep up to date records of all income and expenses. Using an accounting package might help alleviate the work to prepare at year end.

Crypto Currencies
The ATO has seen an increase in transaction volumes from digital coin trading.
If you have purchased or disposed of any assets you will need to account for a capital gain or loss in your tax return.
Make sure to get help or ask your tax agent if you have traded in any crypto currencies, or you can read more about it here – CryptoATO.

The takeaway
In short – the ATO has more data available to analyse and identify outliners.
If you claim expenses make sure you have supporting documents, you aren’t claiming a deduction you aren’t entitled to and you have included all the income earned and you can rest easy cause you have done the right thing.