If there was time to play it by the rules when it comes to what you can and can’t claim on tax, it’s now. The Australian Taxation Office (ATO) has issued a stern warning that they are using data-matching for vehicle registrations and comparing their findings to registration details (such as full names, location, birth date and ABNs). The data matching also allows auditors to acquire vehicle transaction details like the cost of the vehicle to where the vehicle is stored. This information will be used for the financial years 2019 to 2020 and 2021 to 2022. It is expected the ATO will have access to more than 1.5 million residents’ vehicle registration details for both new and used cars.

Data-matching has been used for almost two decades, but sole traders and many other businesses that may be tempted to take advantage of the instant asset write-off increase should consider themselves warned.

The following information will be solicited from new and used car motor vehicle registries for the financial years 2019-2020 and 2021-2022 focusing on vehicle purchases valued or worth more than $10,000.

1. Personal details such as full name, location, contact details, individuals’ birth dates, company ABNs etc. This also includes the details of the vehicle dealers, hire companies and any registering person for a stand-alone body.
2. Details of the transaction will include dates, total cost of the car/van or truck and what the actual market value is, the vehicle’s intended use, dealer licence number.
3. Vehicle details will encompass every identifying fact about the vehicle from the VIN to the gross weight and even the reasons for not having to pay stamp duty.

The ATO will use the information collected in a variety of programs to track down taxpayers who may be prone to incorrectly claim fringe benefits tax, luxury car tax, fuel schemes and business car expenses.

The ATO will also use the data provided to give an overview of an individual or business owners financial standing to pinpoint those who haven’t submitted lodgements or whose assets elude they may be more affluent than they’ve let on. In addition to this, the specifics will be utilised in a range of special projects to uncover illegal tax activities.

All data collated will also be used to identify licensed dealers, hire companies, or fleet managers who attempt to hide their capital accumulation and financial standing.

All information acquired from the data-matching will be retained by the ATO for five years, so taxpayers need to be aware these details are likely to be caught out if they commit tax fraud.

If you have purchased a work vehicle, claimed the instant write-off asset already or simply aren’t sure if you’ve made a mistake (ignorance is no excuse) during the financial years 2019-2020 and 2020-2021, our experienced accountants can help. If you’re concerned about incorrectly reporting your luxury car tax, GST, Fringe Benefits tax or earnings, make an appointment to see us as soon as possible.