ATO increasing data exchange with international regulators
Data sharing between tax regulators in different countries is rapidly increasing with the ATO turning in around 30,000 US expats to the IRS just last year according to a US tax lawyer.
Moodys Gartner director Roy Berg explained that under the Foreign Account Tax Compliance Act, all banks are obligated to work out who their US customers are and then turn them into the regulator in their own country who then turns them into the Internal Revenue Service (IRS) in the US.
“Last year the ATO turned over 30,000 individuals with account balances totalling $25 billion to the IRS,” said Mr Berg.
“FATCA is this worldwide snitching program that is getting people turned in and making them quite nervous. The world has changed very, very quickly in the last five years”
Mr Berg said the FATCA isn’t the only agreement like this, with the OECD creating its own initiative for the automatic exchange of tax and financial information, called the Common Reporting Standard (CRS).
Atlas Wealth Management managing director Brett Evans said even countries like Panama, British Virgin Islands, Luxembourg and Liechtenstein that have traditionally been tax haven-type environments, have signed up to this reporting standard.
“As a result of that they'll be passing on data to the ATO and we've already started to see a lot of clients both domestically and internationally,” said Mr Evans.
Under this reporting standard, Mr Evans said individuals are asked by their account provider, whether it’s a bank or an investment account, if they’re a citizen of another country and if that’s the case they’ll be asked to provide their tax file number.
“Once they do that they’ve got a record of the fact that the individual is based in Denmark for example, but they are an Australian citizen, they’ll pass that information back through to the ATO,” he said.
“Even though you may not have any required lodgements with the ATO, the ATO will still be aware of what's happening.”
Interestingly, Mr Evans said the only developed country that hasn’t signed up to the reporting standard is the US.
“So virtually the United States is in the box seat, because everyone has to pass information to them by way of the FATCA agreement but they don't have to pass information back again,” he said.
“Technically speaking the US could be the last tax haven in the world from a developed country point of view because they don't have to do it.”
MIRANDA BROWNLEE
31 Aug 2017
accountantsdaily.com.au
Hot Issues
- FBT Reminder – Odometer Reading
- ATO’s debts on hold campaign prompts new IGTO guidance
- A comprehensive collection of small business benchmarks
- The 2025 Financial Year tax & super changes you need to know!
- Underperforming employees: When can you terminate?
- A comprehensive list of guides to industry specific tax deductions.
- ‘Renewed concerns’ about economy sees consumer sentiment dip: Westpac
- Oldest Buildings in the World.
- Small businesses may ‘collapse under strain of payday super’, IPA warns
- ATO’s hands tied with scrapping on-hold debts, expert says
- What Drives Your Business Growth and Profits?
- Australian Taxation Office (ATO) shifting to firmer debt collection activity
- Why employee v contractor comes down to fine print
- Sharing economy reporting regime for platform operators
- Countries producing the most solar power by gigawatt hours
- Illegal access nets $637 million
- Accessing superannuation benefits.
- Does your business have a company Power of Attorney?
- Labor tweaks stage 3 tax cuts to make room for ‘middle Australia’
- GrantConnect
- 2 in 3 SMEs benefit from instant asset write-off, survey reveals
- Updated guidance on R&D claims
- Do you know how to recover debts?
- Wheat Production by Country
- Types of small business benchmarks
- What is a Commercial Lease?
- Vimeo test
Article archive
- January - March 2024
- October - December 2023
- July - September 2023
- April - June 2023
- January - March 2023
- October - December 2022
- July - September 2022
- April - June 2022
- January - March 2022
- October - December 2021
- July - September 2021
- April - June 2021
- January - March 2021
- October - December 2020
- July - September 2020
- April - June 2020
- January - March 2020
- October - December 2019
- July - September 2019
- April - June 2019
- January - March 2019
- October - December 2018
- July - September 2018
- April - June 2018
- January - March 2018
- October - December 2017
- July - September 2017
- April - June 2017
- January - March 2017
- October - December 2016
- July - September 2016
- April - June 2016
- January - March 2016
- October - December 2015
- July - September 2015
- April - June 2015
- January - March 2015
- October - December 2014
July - September 2017 archive
- How is your super going, ready for retirement?
- Australia's leading causes of death - ABS
- ATO increasing data exchange with international regulators
- Illegal SMSF early access scheme leads to $6,000 fine
- Our 'hardest' SMSF tasks
- Uber drivers hit for 10% tax
- Lack of literacy promotes unrealistic goals
- Taxpayer failed to prove that payments were “loans”
- New STP dates confirmed as ATO goes on compliance blitz
- ATO flags compliance project for FY17/18
- Items that heat up your depreciation deductions
- Government ‘undermines’ tax system in new moves on property expenses
- Taxpayer denied deduction for work expenses of $60,000
- Overtime meal expenses disallowed because no allowance received
- Key Economic Indicators, 2017
- Government to shut down salary sacrifice loophole
- Crowdfunding legislation gets greenlight
- ATO heavyweight responds to hacking fears
- Checklist - Tax time 2017 - Company, Trust & Partnership
- Checklist - Superannuation Funds - 2017
- ATO to ramp up scrutiny of $20K tax break use
What our clients say about us