Budget 2008-09: Tax Compliance Program 2008/09

01.10.08

The Commissioner has released the Tax Office Compliance Program 2008/09, which sets out the Tax Office’s compliance priorities for that year.

Individuals

The key compliance activities that the Tax Office will focus on include:

• capital gains from the sale of property, shares and other assets;
• contributions to superannuation which exceed the annual contributions limit;
• remuneration packages of senior executives and directors;
• work-related expense claims. In particular, the Tax Office will focus on nurses, medical practitioners and chefs; and
• ‘out of pattern’ claims for self-education, car and travel expenses.

Micro enterprises

Micro enterprises refer to small businesses and self-managed superannuation funds (SMSFs). Key priorities that the Tax Office have identified include:

• assisting employers in managing their tax obligations (e.g. PAYG withholding obligations, superannuation guarantee obligations and FBT obligations);
• assisting micro businesses in managing their tax debts;
• developing new tools for trustees of SMSFs to help them achieve a high level of compliance with superannuation and tax laws;
• ensuring capital gains on sales of assets and investments are correctly reported, including the correct application of small business CGT concessions;
• ensuring offshore income including dividends and interest, royalties and rental income are correctly reported; and
• expanding its compliance activities on the cash economy.

Small to medium enterprises

Small to medium enterprises refer to taxpayers with an annual turnover of between $2 million and $250 million and highly wealthy individuals. Key priorities include:

• monitoring private companies loans and payments to shareholders and their associates to ensure compliance with the tax laws;
• increasing its focus on highly wealthy individuals and following up where necessary with reviews and audits;
• examining business restructures where the primary objective is to receive a tax advantage rather than for preparing a business for sale; and
• seeking judicial clarification on a number of trust issues including the effectiveness of clauses in trust deeds that seek to equate trust income with trust taxable income.

Superannuation

The Tax Office has highlighted several compliance priorities including:

• ensuring members do not access their superannuation early except where permitted; and
• reviewing lost superannuation accounts and following up with the account owners by telephone.