HORSE INDUSTRY TARGETED YET AGAIN BY THE ATO


The Australian Tax Office (ATO) has released details of its thoroughbred data-matching project. Sales information for the two calendar years 2006 & 2007, will be accessed from William Inglis & Son and Magic Millions together with thoroughbred records of the Registrar of Racehorses. This information will be electronically matched to the income tax returns lodged with the ATO as part of its general Data matching program. In other words, this is similar to the ATO matching interest income records of the Bank's customers with their returns.

This targeted data matching program of the horse industry coincides with an equally aggressive approach by the ATO during their intensive audits of horse owners and breeders, conducted over the past five years.

The Tax Office states that the objective of the project is to identify taxpayers who have a significant interest in racehorses and to ascertain those whose net wealth is such that their affairs should be reviewed under the high wealth individuals program. The data will also be used for compliance purposes including those owners who have incorrectly registered their racing activities for GST.

Although the Tax Office has gone public with this announcement, there is little doubt that data matching has been occurring for some time through the audit program.

One only has to examine a sales catalogue, note a yearling sold with "No GST" for many hundreds of thousands, and check to see if a corresponding capital gain has been disclosed in a tax return.

Armed with tens of thousands of sale records and thoroughbred registrations, the ATO is sure to be busy with its enquiries. There is absolutely no better time to review your own circumstances to ensure your house (the stable) is in order.

Should you have any concerns regarding this matter please contact Adam Tims or Paul Scanlon on
+613 9629 3023 or by email.