If you receive any foreign income in the current tax time, take note, you need to report it! Whether it be from family members or working overseas, new international data sharing agreements allow the ATO to track money across borders. This will allow the ATO to identify taxpayers who are not reporting the additional income.
“This year, the ATO has received records relating to more than 1.6 million off-shore accounts holding over $100 billion and is now using data-matching and sophisticated analytics to identify foreign income that has not been reported,” Assistant Commissioner Karen Foat said.
With over 65 foreign tax jurisdictions across the globe, the ATO has shared data on financial account information of foreign tax residents including:
– information on account holders
– interest and dividend payments
– proceeds from the sale of assets and;
– other income
The ATO is raising the matter with taxpayers to ensure they are aware of their obligations and how to report them on their next tax return.
“If you’re an Australian resident for tax purposes, you are taxed on your worldwide income, so you must declare all of your foreign income no matter how small the amount may be. This may include income from offshore investments, employment, pensions, business and consulting, or capital gains on overseas assets,” Ms Foat said. “Even if you have paid tax on the overseas income it must be reported to the ATO, however you may be able to claim a foreign income tax offset to account for any foreign tax paid.”