Sold house, land or shares this year?

At a National Institute of Accountants conference in June 2008, the ATO made the following comments on the sale of investments during the 2008 financial year:

"We have reason to believe that compliance with capital gains tax is improving but we also think there is still room for further improvement.

As at 31 October 2007, approximately 1.2 million people declared around $16.26 billion in capital gains in their 2006 tax returns.

The number of taxpayers who declared net capital gains rose by 3.8% in the 2006 tax year. This is a pleasing result and suggests that more Australians are aware of their capital gains tax obligations. Of course it no doubt also reflects activity in the market.

These gains came mainly from shares and property sales. They may also arise from share buy-backs and capital returns.

Improvements in data matching techniques and access to more data are making it much easier for the Tax Office to identify unreported gains on sales of investments.

We now have access to all state and territory property registers and we have recently secured share trading information from the three primary share registries. We heavily publicise these risks and the tools available to us to check as we really do prefer to alert people rather than catch them out.

We know this area can be daunting for people and we have developed a number of products to assist. Particularly popular [is] assistance - our capital gain or loss decision support and calculation tool receives 100,000 requests per year.

Unfortunately, our review and audit work is still rich pickings. By the end of April we had completed 6,393 audits and reviews for capital gains tax which have resulted in revenue adjustments of $50.2 million"

By D Maynard
CEO My Tax Zone

Copyright 2014. My Tax Zone.