ATO cracking down on 'dodgy deductions'

During the 2014-15 financial year, Mr Whyte said, the ATO conducted around 450,000 reviews and audits of individual taxpayers, which led to revenue adjustments of over $1.1 billion in income tax.

“Every tax return is scrutinised using increasingly sophisticated tools and data analytics developed by our ‘Data Doctors’ at the ATO,” said Mr Whyte.

“This means we can identify and review income tax returns that may omit information or contain unreasonable deductions.”

He said that if any red flags are raised, the ATO will investigate further and where the individual’s claims seem unusual it will check them with the employer.

The ATO has introduced real-time checks of deductions for tax returns completed online, he added.

“If your claims are substantially higher than others in similar occupations, earning similar amounts of income, a message will appear, asking you to check them,” he said.

“Australians claim over $21 billion in work-related expenses each year, and we want to support taxpayers to claim what they are entitled to – no more, no less,” Mr Whyte said.