Boat owners the latest target for the taxman

The Australian Taxation Office’s crusade against wealthy tax dodgers has gone from the luxury car showroom to the marina with the announcement that the tax office will check the tax records of 160,000 boat owners.

The Australian Taxation Office’s crusade against wealthy tax dodgers has gone from the luxury car showroom to the marina with the announcement that the tax office will check the tax records of 160,000 boat owners.

The move is part of the taxman’s program to target conspicuous signs of wealth and comes just a few months after it announced it would check the tax records of luxury vehicle owners in an effort to find high-net worth individuals who are not declaring all their income.

This form of trial-by-stereotype might seem a bit basic, but apparently it works.

“In this instance, the ownership of a commercial or recreational marine vessel may be an indicator of conspicuous unreported wealth,” the tax office said in protocol issued yesterday.

“Early indicators are that the risk of omitted income in identified cases is substantial.”

The tax office is particularly concerned about cases where false or proxy ownership (putting the boat in someone else’s name) is being used to hide wealth.

Deloitte tax partner David Pring says the ATO had completed a similar project focussing on the marine sector in 2006 but its findings were never made public. He says this indicates that there might well be a lucrative review for the tax office.

“It is certainly interesting timing given the announcement as it coincides with soaring fuel prices and is at a time when boat sales are suffering in the current economic times,” Pring says. “It is also curious that the announcement comes just before the Sydney Boat show, the biggest boat show in Australia.”

Steve Burnham, SmartCompany production manager and boat owner, is unhappy with the announcement. “It is attaching some sort of stigma to boat owners, most of whom are just passionate enthusiasts.”

Read more on the tax office and data matching