Program objectives
Our data-matching programs help us fulfil our responsibility to protect public revenue and maintain community confidence in the integrity of the tax and super systems.
The objectives of the Property management data-matching program are to:
- identify and educate individuals and businesses who may be failing to meet their registration or lodgment obligations and help them:
- lodge their income tax returns
- correctly report assessable income from a rental property in their individual income tax return
- correctly report associated rental deductions in their individual income tax return
- comply with capital gains tax obligations for properties used to derive rental income
- gain insights to help develop and implement strategies, which may include educational or compliance activities for individuals and businesses who lease or let real property
- promote voluntary compliance and increase community confidence in the integrity of the tax and super systems.
Why we look at property management data
Sample audits across the Individuals not in business population were conducted under the Random Enquiry Program. Findings from these sample audits informed the net tax gap estimate for the 2020–21 financial year, which totalled $10.2 billion, or 6.3%. Significant drivers leading to the gap include undeclared income, and the incorrect reporting of rental property expenses. The net tax gap for rental property expenses contributed $1.2 billion, or 12% towards the total Individuals not in business gap for the 2019–20 financial year.
One of our strategies to reduce the tax gap is increasing the quantity and quality of the data we collect.
The Property management data-matching program will allow us to identify and address a number of tax risks, including:
- failure to lodge - taxpayers with a rental property may fail to lodge a tax return and their rental property schedule on or before the relevant due date
- omitted or incorrect reporting of income - taxpayers with a rental property may omit or incorrectly report income and deductions in their rental property schedules and associated income tax return labels
- omitted or incorrect reporting of capital gains tax (CGT) - taxpayers with a rental property may omit or incorrectly report cost base elements which are used to determine the net capital gain or loss on a rental property used to generate income.
For more information around rental properties and tax, see: