IN BRIEF
- Misinformation is becoming more prevalent at tax time, the ATO says.
- People are ultimately responsible for their own tax returns.
The Australian Taxation Office (ATO) says it will have its eye on two key areas as Australians lodge their returns, as it warns a surge in online 'tax hacks' and artificial intelligence (AI)-generated advice could leave people facing penalties.
The ATO says work-related deductions and expenses will be under the microscope, as well as omitted income — areas it says taxpayers are most likely to make errors.
It says all sources of income, including that made through interest, rental income, side hustles and cash jobs, must be declared.
"There are different deductions available for each source of income depending on the nature of the income and occupation," ATO assistant commissioner Anita Challen said.
Australians have also been urged to be cautious of information from AI platforms and so-called 'finfluencers' on social media who might spruik shortcuts or hacks they claim can get taxpayers more money back in their pockets.
Even tips from well-meaning family and friends should be treated with caution, the ATO says.
"In reality, all taxpayers can be affected by misinformation," Challen told SBS News. "Even highly tax literate or educated people can get caught out."
Other groups have also warned of misinformation being spread online at tax time.
"If you see a TikTok account suggesting you claim your dog as a legitimate expense this tax time, it’s probably time to put down your phone," Certified Practising Accountants Australia said last year.
People are ultimately responsible for their own tax returns, the ATO says, and those who act on misleading advice risk hefty penalties.
"Taxpayers remain accountable for ensuring the information they or their agents provide to the ATO is accurate — whether the advice came from a friend, online sources, or if AI tools were used in its preparation," Challen said.
"Getting it right upfront prevents delays, incorrect claims and the need for amendments or ATO compliance action."
Penalties range from 25 to 75 per cent of underpaid tax for false or misleading claims, while poor record-keeping can lead to denied deductions, penalties and interest. In serious cases of deliberate fraud, taxpayers can face substantial penalties and potential criminal charges.
Challen acknowledged that not everyone can afford to see a registered tax agent but said there were options for lower-income earners.
This includes the ATO's Tax Help program, which is free and helps eligible people earning $70,000 or less a year to lodge their tax return online.
The ATO also has occupation and industry-specific guides on its website that provide advice on what deductions you can claim.
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