ATO data-matching for motor vehicle registrations

The ATO has gazetted a Notice of a data-matching program – Motor vehicle registrations 2019-20 to 2021-22, which will enable it to acquire motor vehicle registry data from State and Territory motor vehicle registry authorities for this period.

The ATO estimates records relating to approximately 1.5 million individuals will be obtained each financial year. The data will be acquired and matched to ATO internal data holdings to “identify relevant cases for administrative action”.

It does seem that motor vehicles can be a source of more tax mischief than one would have immediately thought, ie the ATO states that the objectives of this program are to:

  • primarily identify and address non-compliance with taxation obligations;
  • obtain intelligence about taxpayers that buy and sell motor vehicles to identify risks and trends of non-compliance with taxation and superannuation obligations;
  • identify and address taxpayers buying and selling motor vehicles who may not be meeting their obligations to register and lodge returns (including activity statements) and ensure the correct reporting of income and entitlement to both deductions and input tax credits;
  • use the motor vehicle purchaser’s data as an indicator of risk, along with other data holdings, to identify taxpayers that have purchased vehicles with values that are not commensurate with the income they have reported;
  • identify cases for investigation of taxpayers of interest, such as seller(s), licenced dealers, fleet managers, leasing companies or representatives of these taxpayers to determine if the use of interposed proxy ownership is used to conceal the real accumulation of wealth, therefore representing a material threat to public revenue;
  • identify and deal with those taxpayers who may not have met their obligations primarily with regards to GST, FBT, luxury car tax, fuel schemes and income tax;
  • promote voluntary compliance and strengthen community confidence in the integrity of the taxation and superannuation systems by publicising the running of this data matching program; and
  • identify, educate or deal with those individuals and businesses who may be failing to meet their registration and/or lodgment obligations and “assist them to comply”.

To summarise, the data will be used to identify higher risk taxpayers with outstanding lodgments and those with undeclared income whose asset holdings “may not be proportionate to their declared financial position”.

The motor registries data-matching is not new – it has been operating for some 16 years in one form or another. The ATO further advises that information will be acquired where records indicate that the purchase price or market value is equal to or greater than $10,000. This threshold was determined by review of vehicle prices trends and cost/benefit assessment.

Ian has worked at Thomson Reuters for over 15 years as a senior tax analyst with expertise in income tax and GST. He has been involved in tax publishing for over 25 years.

Prior to his tax writing career, Ian worked as a manager for a Big 4 accountancy firm and then with a firm which provided specialist tax advice for the music and recording industry.

Ian holds a Bachelor of Economics degree, is a Chartered Accountant and a registered tax agent. Among other things, Ian is the author of the Australian GST Handbook, the GST Commentary Service, the Australian Financial Planning Handbook and the specialist income tax commentary services, as well as being a regular contributor to the news services.

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