Australian Tax Office Focus Areas 2022
ATO 2022 Focus Areas
Key targets for the Australian Taxation Offices (ATO) for the 2022 tax year include work-from-home employees or workers, property inventors, and cryptocurrency traders. A detailed and good record-keeping habit will leave you off the ATO radar.
Work-from-home
Apart from good record keeping, you will need to be logical in claiming the expenses. The ATO would expect to see a reduction in motor vehicles, dry-cleaning, and other work-related expenses claims when there is an increase in work-from-home expenses claims such as mobile phone and other home running costs.
There are three methods to claim work-from-home expenses:
1. Shortcut method – all-inclusive 80 cents for every hour working from home
a. Only available from 1 March 2020 to 30 June 2022
b. Cannot claim any other expenses
2. Fixed Rate method – claim 52 cents for every hour worked from a dedicated work area at home
a. Allow to claim other work-related expenses not covered by the 52 cents such as phone and internet usage and depreciation of home office furniture
3. Actual cost method – a detailed record is required
You are allowed to choose any of the above methods that best suit your circumstances.
Property Inventors
ATO will examine more closely all the rental property claims including short-term rentals i.e., Airbnb and Stayz, and will request proof for the claims made. As a reminder, you can no longer claim deductions on second-hand depreciation assets with those residential rental properties even though exceptions apply.
Cryptocurrency Traders
With the increase of transparency in the digital world, every trading transaction is crystal clear to the ATO and ATO is foreseeing more capital gains and losses reported by cryptocurrency traders. As the tax implication of digital coin transactions can be something new to traders, it is advisable to seek professional advice to familiarise yourself with the tax effect(s). For example, ATO has flagged this to taxpayers saying switching cryptocurrencies within a trading account was still a taxable event.
In conclusion, always bear in mind the 3-Golden Rules when claiming deduction:
1. Money was spent by yourself and has not been reimbursed
2. You can only claim for the portion that relates to income-producing activities when the expense was a mix of income-producing and private use
3. You must have the supporting documentation to substantiate the claim
Contact us if you have any questions.