1 00:00:03,990 --> 00:00:06,810 Sean Aylmer: Welcome to the Fear and Greed Daily Interview. I'm Sean Aylmer. 2 00:00:07,140 --> 00:00:09,508 Sean Aylmer: It's nearly tax time, and if you're one of the 3 00:00:09,510 --> 00:00:13,228 Sean Aylmer: millions of Australians who invest in shares, then it's important 4 00:00:13,230 --> 00:00:15,239 Sean Aylmer: to think about what you need to report to the 5 00:00:15,240 --> 00:00:18,239 Sean Aylmer: Australian Tax Office. And for many people, this might be 6 00:00:18,329 --> 00:00:22,200 Sean Aylmer: unfamiliar terrain. Research by Finder suggests that more than 2 7 00:00:22,200 --> 00:00:25,710 Sean Aylmer: million people bought shares for the first time during the pandemic. 8 00:00:26,009 --> 00:00:29,069 Sean Aylmer: Trading Platform Stake, which is a supporter of this podcast, 9 00:00:29,309 --> 00:00:33,388 Sean Aylmer: wants to help investors navigate tax time smoothly. So today, 10 00:00:33,389 --> 00:00:35,430 Sean Aylmer: we're going to look at a few things investors need 11 00:00:35,430 --> 00:00:39,030 Sean Aylmer: to consider when preparing for the end of the financial year. Remember, 12 00:00:39,030 --> 00:00:42,360 Sean Aylmer: this is general information only and you should certainly seek 13 00:00:42,360 --> 00:00:44,970 Sean Aylmer: professional advice when it comes to your own tax affairs. 14 00:00:45,300 --> 00:00:48,749 Sean Aylmer: Elinor Kasapidis is the senior manager of tax policy at 15 00:00:48,750 --> 00:00:52,710 Sean Aylmer: CPA Australia. Elinor, welcome back to Fear and Greed. 16 00:00:53,400 --> 00:00:54,660 Elinor Kasapidis: Thank you for having me back. 17 00:00:55,500 --> 00:00:58,620 Sean Aylmer: Let's start with the absolute basics. What are the potential 18 00:00:58,650 --> 00:01:01,260 Sean Aylmer: tax liabilities for someone investing in shares on the ASX? 19 00:01:03,090 --> 00:01:05,938 Elinor Kasapidis: If you're investing in shares on the ASX or any 20 00:01:05,940 --> 00:01:09,660 Elinor Kasapidis: other exchange, you are going to incur capital gains when 21 00:01:09,660 --> 00:01:13,380 Elinor Kasapidis: you sell or dispose of the asset. At its simplest, 22 00:01:13,380 --> 00:01:15,450 Elinor Kasapidis: the capital gain is the amount you receive when you 23 00:01:15,450 --> 00:01:18,720 Elinor Kasapidis: sell the asset minus the cost of buying the asset, 24 00:01:18,720 --> 00:01:21,539 Elinor Kasapidis: plus other costs you incur to hold and dispose of 25 00:01:21,539 --> 00:01:24,209 Elinor Kasapidis: it. So, they're things like maybe interest if you've taken 26 00:01:24,209 --> 00:01:27,179 Elinor Kasapidis: out a loan or financial advice fees when you are 27 00:01:27,270 --> 00:01:29,909 Elinor Kasapidis: deciding on your investments, and that's known as the cost 28 00:01:29,910 --> 00:01:33,300 Elinor Kasapidis: base. While you're holding the shares, you may also receive 29 00:01:33,300 --> 00:01:37,380 Elinor Kasapidis: dividend income, or if you've bought unit trust items, then 30 00:01:37,380 --> 00:01:41,880 Elinor Kasapidis: you'll get trust income. Those amounts are reportable as accessible 31 00:01:41,880 --> 00:01:45,119 Elinor Kasapidis: income on your tax return as well. So, while it 32 00:01:45,120 --> 00:01:47,250 Elinor Kasapidis: sounds kind of complicated, at the end of the day, 33 00:01:47,250 --> 00:01:50,400 Elinor Kasapidis: when you're receiving income from the shares, that gets reported 34 00:01:50,400 --> 00:01:53,220 Elinor Kasapidis: on your tax return; and when you sell your shares, 35 00:01:53,220 --> 00:01:56,010 Elinor Kasapidis: the capital gain on that also gets included in your 36 00:01:56,010 --> 00:01:56,281 Elinor Kasapidis: tax return. 37 00:01:56,281 --> 00:01:59,759 Sean Aylmer: Okay. I actually think I followed you there, Elinor. I'm quite 38 00:01:59,759 --> 00:02:02,580 Sean Aylmer: happy with that. So the thing there, it's your dividend 39 00:02:02,580 --> 00:02:05,459 Sean Aylmer: is income, your capital gain, but of course, you take 40 00:02:05,459 --> 00:02:08,669 Sean Aylmer: into account the cost of having those shares that might 41 00:02:08,669 --> 00:02:10,889 Sean Aylmer: be an interest payment, et cetera. So, that's sort of 42 00:02:10,889 --> 00:02:12,900 Sean Aylmer: the basic rules around it. 43 00:02:13,410 --> 00:02:15,780 Elinor Kasapidis: Exactly. Just like if you're buying a property and you 44 00:02:15,780 --> 00:02:18,450 Elinor Kasapidis: have a mortgage and you might have conveyancing fees. It's 45 00:02:18,450 --> 00:02:20,910 Elinor Kasapidis: the same sort of principles applied to shares. 46 00:02:21,389 --> 00:02:23,758 Sean Aylmer: Now, of course, the capital gain occurs when you sell 47 00:02:23,760 --> 00:02:25,860 Sean Aylmer: the share. It's not when you're still holding the share. 48 00:02:26,639 --> 00:02:30,209 Elinor Kasapidis: That's right. Unrealised gains and losses. So, it's not in shares, 49 00:02:30,210 --> 00:02:33,480 Elinor Kasapidis: but in crypto assets for example, we've seen some wild swings. 50 00:02:33,690 --> 00:02:37,110 Elinor Kasapidis: The gain or loss from your investment doesn't actually occur 51 00:02:37,110 --> 00:02:39,870 Elinor Kasapidis: until you've sold it, not while you're holding it. 52 00:02:40,139 --> 00:02:44,970 Sean Aylmer: Okay. We're talking about capital gains, capital losses. Let's say 53 00:02:45,000 --> 00:02:48,389 Sean Aylmer: someone bought... I don't really want to pick on those 54 00:02:48,389 --> 00:02:51,030 Sean Aylmer: online retailers. But let's say we've bought an online retailer 55 00:02:51,030 --> 00:02:53,819 Sean Aylmer: in the middle of COVID and the share price is 56 00:02:53,820 --> 00:02:56,339 Sean Aylmer: now half that and you've had to sell that. So, 57 00:02:56,940 --> 00:02:58,828 Sean Aylmer: what happens with the capital loss on shares? 58 00:02:59,339 --> 00:03:02,100 Elinor Kasapidis: Yep. The market can move both ways. Sometimes you make 59 00:03:02,100 --> 00:03:04,770 Elinor Kasapidis: a gain, sometimes you make a loss. The rules are 60 00:03:04,770 --> 00:03:08,070 Elinor Kasapidis: that you apply any losses against your capital gain. So, 61 00:03:08,070 --> 00:03:10,710 Elinor Kasapidis: say you made a $ 100 loss on your shares because 62 00:03:10,710 --> 00:03:13,440 Elinor Kasapidis: you had to sell them off, but maybe you sold 63 00:03:13,440 --> 00:03:16,590 Elinor Kasapidis: a few others with a $ 200 gain. What you do 64 00:03:16,590 --> 00:03:18,809 Elinor Kasapidis: is you offset those two against each other and you 65 00:03:18,809 --> 00:03:21,270 Elinor Kasapidis: have a net capital gain of $ 100. 66 00:03:21,300 --> 00:03:25,440 Sean Aylmer: Okay. So can you explain, particularly to new investors listening, 67 00:03:26,309 --> 00:03:28,950 Sean Aylmer: you mentioned dividends, and so that's a source of income, 68 00:03:29,280 --> 00:03:33,298 Sean Aylmer: but the dividend imputation system, the idea of franked credits, 69 00:03:33,419 --> 00:03:34,200 Sean Aylmer: what is that about? 70 00:03:34,710 --> 00:03:38,760 Elinor Kasapidis: Yeah. When a company, especially listed companies, they pay generally 71 00:03:38,760 --> 00:03:42,300 Elinor Kasapidis: tax at 30%. So, when they pay out a dividend, 72 00:03:42,300 --> 00:03:45,269 Elinor Kasapidis: they actually attach the 30 cents of tax that they've 73 00:03:45,270 --> 00:03:48,420 Elinor Kasapidis: paid already to that dividend, and you can claim that 74 00:03:48,420 --> 00:03:51,389 Elinor Kasapidis: back as a franking credit on your tax return. Essentially 75 00:03:51,389 --> 00:03:53,820 Elinor Kasapidis: what it's doing is making sure that you don't pay 76 00:03:53,820 --> 00:03:56,520 Elinor Kasapidis: another set of tax on top of what the company's 77 00:03:56,520 --> 00:04:00,450 Elinor Kasapidis: already paid beforehand. What you'll see going through is that 78 00:04:00,450 --> 00:04:04,080 Elinor Kasapidis: you have franking credits labels on the tax return, and when you 79 00:04:04,080 --> 00:04:06,630 Elinor Kasapidis: get your statements from the platforms that tell you how 80 00:04:06,630 --> 00:04:09,660 Elinor Kasapidis: you've bought and sold the dividends that you've received, they'll 81 00:04:09,719 --> 00:04:11,639 Elinor Kasapidis: show you the amount of the dividend and the amount 82 00:04:11,639 --> 00:04:12,540 Elinor Kasapidis: of the franking credit. 83 00:04:13,050 --> 00:04:15,180 Sean Aylmer: Stay with me, Elinor, we'll be back in a minute. 84 00:04:20,970 --> 00:04:24,599 Sean Aylmer: I'm speaking to Elinor Kasapidis, senior manager of tax policy 85 00:04:24,599 --> 00:04:29,219 Sean Aylmer: at CPA Australia. Okay. That whole double taxation, the idea 86 00:04:29,219 --> 00:04:32,640 Sean Aylmer: that the company pays Australian tax, therefore why should I 87 00:04:32,640 --> 00:04:35,880 Sean Aylmer: as a shareholder who's getting this dividend in after tax 88 00:04:36,240 --> 00:04:39,719 Sean Aylmer: earnings from the company, why should I pay double tax 89 00:04:39,719 --> 00:04:42,059 Sean Aylmer: on that? I get that. What about when they start 90 00:04:42,059 --> 00:04:45,719 Sean Aylmer: talking about partly franked dividends and those sorts of things? 91 00:04:46,049 --> 00:04:49,410 Elinor Kasapidis: Yep. Not every dividend is going to be fully franked. 92 00:04:49,529 --> 00:04:51,839 Elinor Kasapidis: It's one of those things where if a company, for 93 00:04:51,839 --> 00:04:55,950 Elinor Kasapidis: example, decides to retain some capital or perhaps they've had 94 00:04:55,950 --> 00:04:59,070 Elinor Kasapidis: some taxable losses, which means that even though they might 95 00:04:59,070 --> 00:05:02,130 Elinor Kasapidis: be making a profit on the financial statements when it 96 00:05:02,130 --> 00:05:04,769 Elinor Kasapidis: comes to the tax, they might have large deductions, so 97 00:05:04,770 --> 00:05:08,339 Elinor Kasapidis: they don't actually pay tax and they therefore don't have any 98 00:05:08,339 --> 00:05:11,460 Elinor Kasapidis: credits to attach to the dividend. That's where you'll see 99 00:05:11,460 --> 00:05:15,269 Elinor Kasapidis: either zero unfranked dividends or you'll have partially franked dividends. 100 00:05:15,360 --> 00:05:18,809 Elinor Kasapidis: Once again, your statements should show how much franking credit 101 00:05:18,809 --> 00:05:23,310 Elinor Kasapidis: you can actually claim against that dividend income. Interestingly enough, 102 00:05:23,490 --> 00:05:25,620 Elinor Kasapidis: it is a good idea with the avoidance of double 103 00:05:25,620 --> 00:05:28,230 Elinor Kasapidis: taxation, but Australia is actually one of the last countries 104 00:05:28,230 --> 00:05:31,229 Elinor Kasapidis: in the world to have an imputation regime. So, it's 105 00:05:31,230 --> 00:05:33,599 Elinor Kasapidis: something that's very true to our heart, but it's not 106 00:05:33,599 --> 00:05:36,599 Elinor Kasapidis: necessarily how other tax systems around the world work. 107 00:05:37,410 --> 00:05:39,719 Sean Aylmer: And of course, there is some discussion at the moment 108 00:05:39,719 --> 00:05:42,599 Sean Aylmer: about changing some of the rules around dividend and imputation, 109 00:05:43,140 --> 00:05:48,870 Sean Aylmer: the idea being that some forms of income for companies shouldn't get 110 00:05:48,870 --> 00:05:49,740 Sean Aylmer: the franking credits. 111 00:05:50,400 --> 00:05:53,820 Elinor Kasapidis: It's always a tricky area to wade into because we've 112 00:05:53,820 --> 00:05:56,520 Elinor Kasapidis: got it so set up and well established and investors 113 00:05:56,639 --> 00:05:59,699 Elinor Kasapidis: understand the rules. Sometimes making a big shift from that 114 00:05:59,699 --> 00:06:01,710 Elinor Kasapidis: can be really difficult, and we need to have a 115 00:06:01,710 --> 00:06:05,400 Elinor Kasapidis: good solution that doesn't impact too many people and investments 116 00:06:05,400 --> 00:06:08,039 Elinor Kasapidis: negatively. So, tax reform is always a difficult area. 117 00:06:08,520 --> 00:06:10,020 Sean Aylmer: Ah, yes. Indeed it is. In fact, the last time 118 00:06:10,020 --> 00:06:12,059 Sean Aylmer: you were on the show, I think Adam Lang interviewed 119 00:06:12,059 --> 00:06:14,279 Sean Aylmer: you. No one likes talking about tax reform more than 120 00:06:14,279 --> 00:06:17,428 Sean Aylmer: him. I'm sure that if he was interviewing you today, 121 00:06:17,760 --> 00:06:19,738 Sean Aylmer: that's where we'd be going. But we're not. We're going 122 00:06:19,740 --> 00:06:23,400 Sean Aylmer: to go overseas share. Nowadays, it's much easier to buy 123 00:06:23,640 --> 00:06:27,240 Sean Aylmer: US stocks. From a tax perspective, so let's say I 124 00:06:27,240 --> 00:06:29,939 Sean Aylmer: bought Apple shares and I sold Apple shares at some point 125 00:06:29,940 --> 00:06:31,650 Sean Aylmer: in the last 12 months, do I think about it 126 00:06:31,650 --> 00:06:32,460 Sean Aylmer: any differently? 127 00:06:33,690 --> 00:06:36,810 Elinor Kasapidis: No. If you're an Australian tax resident, you are actually 128 00:06:36,839 --> 00:06:40,050 Elinor Kasapidis: taxed on both your Australian source income as well as 129 00:06:40,050 --> 00:06:43,410 Elinor Kasapidis: your foreign source income. And whenever we head over the 130 00:06:43,410 --> 00:06:47,670 Elinor Kasapidis: borders, world of international tax kicks in. So, you'll not 131 00:06:47,670 --> 00:06:50,700 Elinor Kasapidis: only have your Australian tax obligations, but depending on where 132 00:06:50,700 --> 00:06:53,428 Elinor Kasapidis: you're investing, they're going to have rules for their foreign 133 00:06:53,430 --> 00:06:57,930 Elinor Kasapidis: investment regimes. I think it's really around know where you're 134 00:06:57,930 --> 00:07:01,440 Elinor Kasapidis: headed, who you're buying from, and understand the tax rules 135 00:07:01,440 --> 00:07:04,110 Elinor Kasapidis: in the jurisdiction that they're operating from. 136 00:07:04,678 --> 00:07:07,199 Sean Aylmer: Just using that as an example, if I'm an Australian 137 00:07:07,290 --> 00:07:10,739 Sean Aylmer: tax resident and I buy Apple shares, then I'm going 138 00:07:10,740 --> 00:07:13,530 Sean Aylmer: to be taxed on any capital gain or loss I 139 00:07:13,530 --> 00:07:15,900 Sean Aylmer: get from that. But there is the potential... I mean, 140 00:07:15,900 --> 00:07:18,660 Sean Aylmer: do I need to see someone, an advisor about whether 141 00:07:18,660 --> 00:07:20,639 Sean Aylmer: I have to pay US tax or is that normally 142 00:07:20,639 --> 00:07:21,780 Sean Aylmer: done through my broker? 143 00:07:22,800 --> 00:07:25,619 Elinor Kasapidis: Well, it will depend on your broker's terms and conditions. 144 00:07:25,620 --> 00:07:28,709 Elinor Kasapidis: You definitely might want to consider going through a broker 145 00:07:28,709 --> 00:07:31,590 Elinor Kasapidis: who is familiar with the market, let's say the US. 146 00:07:31,920 --> 00:07:35,520 Elinor Kasapidis: The dividend income as well that you might receive is assessable. 147 00:07:35,700 --> 00:07:38,489 Elinor Kasapidis: It's not just your capital gains and losses, but if 148 00:07:38,490 --> 00:07:42,420 Elinor Kasapidis: it's dividend income, or often exchanged traded funds are quite 149 00:07:42,660 --> 00:07:46,170 Elinor Kasapidis: popular with investors, and they will actually have distributions from 150 00:07:46,170 --> 00:07:50,070 Elinor Kasapidis: unit trusts. They'll have a whole mix of income coming through. 151 00:07:50,310 --> 00:07:53,490 Elinor Kasapidis: So the more complicated, or I guess the more uncertain 152 00:07:53,490 --> 00:07:56,429 Elinor Kasapidis: you are about the country that you're trading with or 153 00:07:56,429 --> 00:07:59,429 Elinor Kasapidis: where those shares are located, the more you should consider 154 00:07:59,429 --> 00:08:02,789 Elinor Kasapidis: getting professional advice and speaking to a registered tax agent 155 00:08:02,790 --> 00:08:04,410 Elinor Kasapidis: who understands the rules. 156 00:08:04,710 --> 00:08:07,770 Sean Aylmer: Okay. Now moving on. The ATO has revealed that what it 157 00:08:07,770 --> 00:08:10,050 Sean Aylmer: will be targeting this year, and top of the list 158 00:08:10,380 --> 00:08:15,179 Sean Aylmer: is landlords overclaiming tax deductions. Apparently 9 out... I couldn't 159 00:08:15,179 --> 00:08:17,849 Sean Aylmer: believe this stat. 9 out of 10 landlords make mistakes 160 00:08:17,849 --> 00:08:22,649 Sean Aylmer: in their tax returns, incorrectly claiming expenses. I don't know 161 00:08:22,650 --> 00:08:25,049 Sean Aylmer: whether that says something about the landlords, whether that says 162 00:08:25,050 --> 00:08:28,290 Sean Aylmer: something about the rules around it. But whatever it is, 163 00:08:28,290 --> 00:08:30,390 Sean Aylmer: is there a general rule of thumb here for landlords 164 00:08:30,390 --> 00:08:33,809 Sean Aylmer: when considering doing their tax, particularly around expenses? 165 00:08:34,679 --> 00:08:38,160 Elinor Kasapidis: It's definitely a bit of both. There are some landlords 166 00:08:38,160 --> 00:08:41,100 Elinor Kasapidis: who are not properly keeping records, which makes it really 167 00:08:41,100 --> 00:08:43,830 Elinor Kasapidis: hard for them to substantiate. But also, a lot of 168 00:08:43,830 --> 00:08:47,550 Elinor Kasapidis: the rules around property investing or tax more generally can 169 00:08:47,550 --> 00:08:50,490 Elinor Kasapidis: be a bit wishy- washy or the expectations and the 170 00:08:50,490 --> 00:08:53,759 Elinor Kasapidis: reality of what the ATO wants to see versus what 171 00:08:53,759 --> 00:08:58,619 Elinor Kasapidis: actually happens can be quite stark. CPA Australia, we came 172 00:08:58,619 --> 00:09:01,260 Elinor Kasapidis: up with the three Rs of tax literacy for this 173 00:09:01,260 --> 00:09:05,250 Elinor Kasapidis: tax time. Just to remind listeners and taxpayers- 174 00:09:05,340 --> 00:09:05,581 Sean Aylmer: Please, yeah. 175 00:09:05,581 --> 00:09:08,520 Elinor Kasapidis: ... about the some key rules. The first one is 176 00:09:08,520 --> 00:09:11,939 Elinor Kasapidis: to record everything. As we understand it, a lot of 177 00:09:11,940 --> 00:09:14,610 Elinor Kasapidis: the claims are getting thrown out, not because it wasn't 178 00:09:14,610 --> 00:09:17,819 Elinor Kasapidis: a deduction that might be available, but simply because the 179 00:09:17,820 --> 00:09:22,530 Elinor Kasapidis: landlords aren't keeping the right records or they're misclassifying things, not 180 00:09:22,530 --> 00:09:25,890 Elinor Kasapidis: understanding the rules. So there's that complexity element as well. 181 00:09:26,130 --> 00:09:30,150 Elinor Kasapidis: So, if you record everything and have detailed information, whether 182 00:09:30,150 --> 00:09:32,130 Elinor Kasapidis: you do it yourself or you go and see a 183 00:09:32,130 --> 00:09:36,330 Elinor Kasapidis: registered tax agent, you'll be able to justify your claim. 184 00:09:36,420 --> 00:09:39,809 Elinor Kasapidis: The tax agent can calculate the right amount of deductions 185 00:09:39,870 --> 00:09:42,270 Elinor Kasapidis: and when the ATO or if the ATO comes and 186 00:09:42,270 --> 00:09:45,600 Elinor Kasapidis: checks, you get that 1 in 10 tick of approval 187 00:09:45,719 --> 00:09:47,759 Elinor Kasapidis: for having the right record. So, it really is about 188 00:09:47,759 --> 00:09:51,599 Elinor Kasapidis: recording everything. The other thing is about being reasonable. We 189 00:09:51,599 --> 00:09:56,550 Elinor Kasapidis: have heard examples where taxpayers will go or landlords will 190 00:09:56,550 --> 00:09:59,430 Elinor Kasapidis: go to a tax agent and sort of assure them 191 00:09:59,850 --> 00:10:02,429 Elinor Kasapidis: and confirm that, you know, " I spent all of this 192 00:10:02,429 --> 00:10:04,649 Elinor Kasapidis: money on repairs and maintenance," when in fact they did 193 00:10:04,650 --> 00:10:09,030 Elinor Kasapidis: a big renovation, for example. Sometimes, the claims that they're 194 00:10:09,030 --> 00:10:11,488 Elinor Kasapidis: trying to make are not reasonable. So, you really want 195 00:10:11,490 --> 00:10:13,980 Elinor Kasapidis: to be thinking as a landlord and as a tax agent, 196 00:10:14,520 --> 00:10:17,280 Elinor Kasapidis: what is the realistic margin that should be made? Are 197 00:10:17,280 --> 00:10:20,189 Elinor Kasapidis: they overclaiming the interest expenses? Does it look a bit 198 00:10:20,190 --> 00:10:23,370 Elinor Kasapidis: high? Again, people will try to claim all the interest 199 00:10:23,370 --> 00:10:26,009 Elinor Kasapidis: when they've withdrawn or redrawn a whole amount of money 200 00:10:26,009 --> 00:10:28,649 Elinor Kasapidis: that's for personal use or they're trying to claim the 201 00:10:28,650 --> 00:10:32,699 Elinor Kasapidis: private part of their home, Airbnb stay or something like that. 202 00:10:33,210 --> 00:10:35,820 Elinor Kasapidis: Thirdly, it's the reaching out. It's really about getting the 203 00:10:35,820 --> 00:10:39,509 Elinor Kasapidis: right advice. Clearly, the law is complex. There are gray 204 00:10:39,510 --> 00:10:43,139 Elinor Kasapidis: areas and the terms can get really confusing. Really, what's 205 00:10:43,139 --> 00:10:46,049 Elinor Kasapidis: the difference between a repair and installing a new kitchen? 206 00:10:46,049 --> 00:10:47,940 Elinor Kasapidis: It's all the same thing. But when it comes to 207 00:10:47,940 --> 00:10:50,968 Elinor Kasapidis: the ATO, they don't see things the same way. So, 208 00:10:50,970 --> 00:10:53,670 Elinor Kasapidis: those are really the areas, I think, where landlords in 209 00:10:53,670 --> 00:10:57,270 Elinor Kasapidis: particular, but just investors in general... Same with your shares. 210 00:10:57,510 --> 00:11:00,598 Elinor Kasapidis: If you've got loans to fund your investments, make sure 211 00:11:00,599 --> 00:11:03,389 Elinor Kasapidis: you're keeping records of both sides of the ledger. If 212 00:11:03,389 --> 00:11:06,119 Elinor Kasapidis: you need to provide evidence about your cost base, so 213 00:11:06,119 --> 00:11:09,120 Elinor Kasapidis: the expenses that you've incurred, make sure you have those 214 00:11:09,120 --> 00:11:11,250 Elinor Kasapidis: receipts and keep them for as long as you hold 215 00:11:11,250 --> 00:11:15,420 Elinor Kasapidis: the asset, plus the necessary period after you've lodged the return. 216 00:11:16,020 --> 00:11:19,230 Sean Aylmer: Okay. And I presume that applies in its own way to 217 00:11:20,190 --> 00:11:23,128 Sean Aylmer: another focus for the ATO was work expenses, for example. 218 00:11:23,699 --> 00:11:27,570 Elinor Kasapidis: Yep, definitely. Anecdotally, our members are reporting that the ATO 219 00:11:27,570 --> 00:11:30,480 Elinor Kasapidis: is definitely on the beat with work- related expenses, and 220 00:11:30,480 --> 00:11:33,690 Elinor Kasapidis: they have real time comparison and scanning of claims to 221 00:11:33,690 --> 00:11:37,500 Elinor Kasapidis: pick out the ones that look unreasonable. Again, when people 222 00:11:37,500 --> 00:11:41,070 Elinor Kasapidis: are trying to claim their Tim Tam expenditure or perhaps 223 00:11:41,070 --> 00:11:44,550 Elinor Kasapidis: doggy daycare as work from home, the ATO's onto it 224 00:11:44,550 --> 00:11:47,730 Elinor Kasapidis: pretty quickly. Again, a lot of the time with work- from- 225 00:11:47,730 --> 00:11:50,760 Elinor Kasapidis: home diaries, the rules changed earlier this year, you need 226 00:11:50,760 --> 00:11:54,480 Elinor Kasapidis: to be keeping daily records or logbooks for motor vehicle 227 00:11:54,480 --> 00:11:57,358 Elinor Kasapidis: expenses. A lot of those claims are getting thrown out 228 00:11:57,360 --> 00:12:00,960 Elinor Kasapidis: because they're missing the necessary information. The ATO is getting 229 00:12:00,960 --> 00:12:03,300 Elinor Kasapidis: quite tough and records are where a lot of people 230 00:12:03,300 --> 00:12:04,140 Elinor Kasapidis: are falling down. 231 00:12:04,500 --> 00:12:07,020 Sean Aylmer: The other thing I must say about the ATO, anytime I've dealt with them, 232 00:12:07,020 --> 00:12:09,718 Sean Aylmer: when I've rung them, because I haven't understood stuff, they've 233 00:12:09,719 --> 00:12:12,809 Sean Aylmer: been fantastic. They're actually very open to have a conversation 234 00:12:12,809 --> 00:12:13,108 Sean Aylmer: with you. 235 00:12:13,679 --> 00:12:16,410 Elinor Kasapidis: Yeah, definitely. They do have that educate approach and their 236 00:12:16,410 --> 00:12:19,800 Elinor Kasapidis: website is a treasure trove of information. They've invested a 237 00:12:19,800 --> 00:12:22,980 Elinor Kasapidis: lot in that. Often, what we find is that it's 238 00:12:22,980 --> 00:12:25,110 Elinor Kasapidis: a really good place to go when you've got simple 239 00:12:25,110 --> 00:12:28,078 Elinor Kasapidis: affairs or perhaps a general question. When it comes to 240 00:12:28,080 --> 00:12:31,170 Elinor Kasapidis: the level of detail, if you've got a complex portfolio 241 00:12:31,170 --> 00:12:34,618 Elinor Kasapidis: or you're investing overseas, that's where a registered tax agent 242 00:12:34,619 --> 00:12:37,949 Elinor Kasapidis: like a CPA can give you that additional tailored advice. 243 00:12:38,550 --> 00:12:40,439 Sean Aylmer: Elinor, thank you for talking to Fear and Greed. 244 00:12:40,740 --> 00:12:41,790 Elinor Kasapidis: Thanks so much for having me. 245 00:12:42,330 --> 00:12:45,870 Sean Aylmer: That was Elinor Kasapidis, senior manager of tax policy at 246 00:12:45,900 --> 00:12:49,319 Sean Aylmer: CPA Australia. This is the Fear and Greed Daily Interview 247 00:12:49,320 --> 00:12:52,468 Sean Aylmer: brought to you today by Stake. Remember, this was general 248 00:12:52,469 --> 00:12:55,350 Sean Aylmer: information only and you should get professional tax advice tailored 249 00:12:55,440 --> 00:12:57,870 Sean Aylmer: to you. Join us every morning for the full episode 250 00:12:57,870 --> 00:13:00,809 Sean Aylmer: of Fear and Greed, Australia's most popular business podcast. I'm 251 00:13:00,809 --> 00:13:02,458 Sean Aylmer: Sean Aylmer. Enjoy your day.