property owners
Photo: iStock/elenaleonova

The Australian Tax Office (ATO) says too many individuals and small businesses are making excessive tax deductions and has threatened to come after them.

The update aimed at property owners came in a message conveyed by Taxation Commissioner Chris Jordan in a speech to the National Press Club in Canberra.

The ATO particularly wants to target taxpayers with attitudes like: “Everyone cheats a bit, so I can too”; “others won’t care if I cheat”; and, “I claim deductions (legit or not) to make sure I get a refund”, Mr Jordan said.

He said over-claiming can be due to legitimate mistakes, carelessness, recklessness and fraud.

In 2014-15, more than $22 billion was claimed for work-related expenses.

Common over-claiming tax deductions include property rentals

Mr Jordan said the problem with rental deductions exceeding incomes is that it can result in about $3.6 billion net rental loss.

“There is about $40 billion of rental income and $44 billion of rental deductions,” he observed.