In a new bid to catch tax-evading businesses, the Australian Taxation Office (ATO) has made the following policy announcement: “The Australian Taxation Office (ATO) will acquire motor vehicle registry data from state and territory motor vehicle registry authorities for 2019–20 through to 2021–22.”
The data received will include ABNs or company numbers for sole traders and business owners, names, addresses, and the sale price of the vehicle. It will also include the vehicle address, make and model, and if the buyer received an exemption to pay stamp duty tax. If you are concerned while reading this, then we recommend you reach out to your business accountant today.
In their statement, the ATO said the new strategy would allow them to view the records of close to 1.5 million people every financial year. Once the data is obtained, it will then be cross-checked with government agency data to see if taxpayers are following the rules and abiding by taxation and superannuation policy. Simply put, this means the ATO will ‘red flag’ people of interest, explained Elinor Kasapidis, Senior Manager of Tax Policy at CPA Australia.
This will have ramifications for business owners who may have accessed the government’s ‘instant write off’ program. This scheme is subject to value thresholds, which for cars is $57,581 for the 2019-20 income year. These people will receive a red flag, as will people who have purchased their family car through a business. If this sounds confusing, then we advise talking to your business accountant to make sure you are compliant with the policy.
Car purchases are subject to many different tax implications such as GST, fuel schemes, fringe benefits tax, luxury car tax, and income tax. If you are concerned about any tax implications, then please speak to your business accountant.
The information in this article is general in nature and might not be right for your circumstances. Please arrange a meeting with one of our Accountants to discuss your particular needs. Accountants 2 Business Ph (07) 3823 2344