Sharing images and content online to showcase your recent vacation or purchase may have appeared favourable initially, but it’s crucial to consider the audience, including potential tax agents, who might be browsing your social media profiles.
The ATO has always looked at different ways to match data with what taxpayers declare in their tax returns against information available from other sources. They have accessed databases from other statutory bodies and private entities (including stamp duty, real estate, eBay and asset records) to check what assets taxpayers have and what has been purchased and sold. If the assets held or purchased are not supported by the level of income declared in the taxpayer’s tax return in a particular year, the ATO may ask some questions and instigate audit activity.
Now the ATO has taken the next step and employed an internal team to review taxpayers’ social media pages to data match with their tax returns to determine whether the income and assets disclosed in their tax returns correspond with the lifestyle or assets shown in their social media. Examples of areas that the ATO may have an interest in are as follows
- Is there a website on the business’s Facebook page for a business that is not being declared in your returns?
- Does your disclosed taxable income support what you are doing and spending? Significant overseas holidays shown on your social media, sending kids to private schools and showing properties in your social media posts may attract ATO attention compared to income levels disclosed in your returns.
- Are you claiming expenses that may not be legitimate, and posts on your social media may catch you out? Travel trips claimed as business posts, holiday jaunts, or the like can open up an enquiry from the ATO.
So what is the moral of the story? Ensure your tax affairs are kept clean so you don’t have anything to worry about with any of the above issues. More importantly, ensure your post in the public domain reflects your situation. While that post to get some likes and make your friends jealous may seem like a good idaea at the time, if it is not real and not easily supported by what you are disclosing to the ATO elsewhere, then you are asking for trouble.
Kreston Stanley Williamson Team
*Correct as of August 2017
*Disclaimer – this article has been produced by Kreston Stanley Williamson as a service to its clients and associates. The information contained in the article is of general comment only and is not intended to be advice on any particular matter. Before acting on any areas in this article, you must seek advice about your circumstances. Liability is limited by a scheme approved under professional standards legislation.