Tax experts say that Airbnb owners or other forms of landlords must report revenue truthfully, or ATO will give you a "surprise" at any time.
ATO is known to have targeted such landlords and is randomly auditing their tax claims, (Claim), and trying to identify "errors" in their tax returns.
According to the Financial Review, Kath Anderson, assistant commissioner at ATO, said ATO found that many owners had extensive experience in covering up their income (or exaggerating spending) and worried that they had "made a lot of mistakes" in their tax returns.
To do so, they will randomly audit owners` tax claims, including comparing them to similar properties in the same zip code, or using third-party packets, including popular rental list websites.
Mark Chapman, head of tax communications at the Australian Inland Revenue Authority, said it was easy for ATO`s powerful intelligence network to determine whether to rent a property.
During holidays, holiday homes in prime locations usually bring good returns to homeowners, as well as expensive taxes.
Airbnb landlords, like others who rent properties, have to report their income truthfully in their income tax returns, says Chapman. "the most common mistake for Airbnb landlords is that they don`t properly allocate the cost of renting a property," says Chapman. You can only claim expenses related to rental property, or part of a public area such as a kitchen or lounge, and it is easy to exaggerate this ratio and ultimately lead to excessive claims.
