ATO Data Matching and Tax Evasion

many a year ago, I knew of a family that ran a family restaurant, so lots of cash cash cash involved,
they then bought a house for cash, I think it was about $900k, (this was in the 2000s)

ATO matched it straight away, and they had to pay close to $500k in back taxes and penalties,it wouldnt surpirse me if they declared the business profiting $40k when it was probably profiting $200k per year

In hindsight, its pretty stupid to buy a $900k house with cash
 
I agree Rolf.
I am a genuine non resident. I visit Australia once or twice per year. My ppor is overseas and I maintain no real ties to Australia. The issue is that I have bank accounts in oz and I mostly invest in oz. so I do flag. I complete the ATOs residency test every year just to make sure, but I am one of the few expats who are genuinely non-resident.

In many ways I agree with the new tax for expats. I think where one person works overseas for 6or9 months a year, while the rest of the family lives in oz, and uses all the govt provided services - they should pay tax.

Blacky
 
If you have ever been a resident, then even minor and infrequent visits to Australia can maintain your residence under common law depending on the circumstances.

I'd love to spend a few days in Oz every year to become classified a resident but it won't work. Why are you guys talking like there's some advantage to being non resident? The only benefit I can see is not having to declare rental income from my overseas property. The biggest downside of being non res is that I've lost my tax free threshold and pay 32.5% on the first $80k of income derived in Oz. I made a cap gain last FY and just paid a $57k tax bill last week because I'm non res :mad:
 
I'd love to spend a few days in Oz every year to become classified a resident but it won't work. Why are you guys talking like there's some advantage to being non resident? The only benefit I can see is not having to declare rental income from my overseas property. The biggest downside of being non res is that I've lost my tax free threshold and pay 32.5% on the first $80k of income derived in Oz. I made a cap gain last FY and just paid a $57k tax bill last week because I'm non res :mad:

Won't work ? Nobody explained that to the Federal or High Court.

Or maybe you fell foul of a double tax agreement between Australia and your other country of residence.

If you had made the capital gain on Australian shares then there would have been no tax as a non-resident (unless they were acquired whilst a resident).

You chose taxable Australian real property which is subject to CGT.
 
In many ways I agree with the new tax for expats. I think where one person works overseas for 6or9 months a year, while the rest of the family lives in oz, and uses all the govt provided services - they should pay tax.
Is there a new tax for non residents?

I was questioned on my residency status 23 years ago.
 
The last time I was in Oz was 2 years ago for a week's visit but apart from the 183 day test how else can they decide if I'm a resident? I spend about 6-8 months of the year in Hong Kong and split the rest of the time between Thailand and Bali. I made the cap gain from selling a property in Oz.
 
The last time I was in Oz was 2 years ago for a week's visit but apart from the 183 day test how else can they decide if I'm a resident? I spend about 6-8 months of the year in Hong Kong and split the rest of the time between Thailand and Bali. I made the cap gain from selling a property in Oz.
Get a PPOR in Oz. Base your family here ;-)
 
The last time I was in Oz was 2 years ago for a week's visit but apart from the 183 day test how else can they decide if I'm a resident? I spend about 6-8 months of the year in Hong Kong and split the rest of the time between Thailand and Bali. I made the cap gain from selling a property in Oz.

So you have never been a resident before or a double tax agreement deems you solely a resident of another country/countries.

Well then, you don't have to pay Australian tax on your HK/Indonesian/Thai income.

You wouldn't have paid Australian CGT on Australian shares.

You chose to hold taxable Australian property instead.

Did you at least use the apportioned CGT discount ?
 
The last time I was in Oz was 2 years ago for a week's visit but apart from the 183 day test how else can they decide if I'm a resident? I spend about 6-8 months of the year in Hong Kong and split the rest of the time between Thailand and Bali. I made the cap gain from selling a property in Oz.

There is no longer a 183 day rule. You may not spend a single day in the country and still be classed as resident. Alternatively you may spend every day in the country and be claimed non-resident (though good luck with that). If your family wife,kids) lives in oz you are resident for tax.

New rules came in 1 July 2009.

If you are a resident for tax purposes all income is taxable in Australia, regardless of where it is earned.

Blacky
 
There is no longer a 183 day rule. You may not spend a single day in the country and still be classed as resident. Alternatively you may spend every day in the country and be claimed non-resident (though good luck with that). If your family wife,kids) lives in oz you are resident for tax.

New rules came in 1 July 2009.

If you are a resident for tax purposes all income is taxable in Australia, regardless of where it is earned.

Blacky

You had me going there !

However, to be sure I went back to check s.6(1) ITAA36 and there it still is !
 
You had me going there !

However, to be sure I went back to check s.6(1) ITAA36 and there it still is !

Sorry. Maybe I wasn't clear. 183 days is a secondary test. It is not as clear cut as it used to be. Spending 183days a year outside Aus does not in itself determine your non-residency status. Though it does have an impact.
 
The 183 day test is for visitors who are not residents under the default common law test.

This test is irrelevant for a resident who departs during a year.
 
So you have never been a resident before or a double tax agreement deems you solely a resident of another country/countries.

Well then, you don't have to pay Australian tax on your HK/Indonesian/Thai income.

You wouldn't have paid Australian CGT on Australian shares.

You chose to hold taxable Australian property instead.

Did you at least use the apportioned CGT discount ?

I'd always been a resident until I moved to Thailand in 2007. My accountant notified me I was non res about 2-3 years after my departure. All my share dividend notices have "Non Resident" recorded next to my TFN/ABN status but I'm not sure how that came about or what made the ATO decide to classify me as non res.

Yes, I don't pay any tax to the ATO on rent from my overseas property as a non res but I believe I'm obliged to disclose these holdings and pay tax on them if I become resident again?

Yes I claimed the apportioned CGT discount but I believe they've now removed the CGT discount for non residents in the last budget.

Rob, if I don't have to pay CGT on Oz shares, does that mean I also can't claim/offset capital losses against any gains made on property? And I also don't have to pay tax on share dividends? Thanks for any info.

TT
 
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Did you hold the shares at the time you became a non-resident ?

If so, did you elect to defer capital gains at the time of change of residency by treating them as taxable Australian property ?

If yes to both, then the share capital losses might be able to be offset against the gain on the property.

You would need to verify any election with your accountant.

Dividends are subject to withholding tax by the company paying them. The rate is zero for franked dividends. There is no tax to pay by the non-resident shareholder in any case on dividends from a small shareholding.
 
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