Taxman chases Aussie hit makers

August 25, 2014 11:24 pm 60 comments Views:
The Australian Tax Office will look to recoup any undeclared income from royalties and ot

The Australian Tax Office will look to recoup any undeclared income from royalties and other payments.
Source: Supplied

THOUSANDS of musicians and composers, including rock and pop stars, will be targets of a crackdown on tax cheats in the local music industry.

The Herald Sun has learned that in July, the Australian Taxation Office used its coercive powers to secretly obtain the details of some $ 800 million in royalty collections and payments for the three years to June 30 last year.

These will now be cross-matched with the tax records of individual composers, songwriters, lyricists, music publishers, and copyright owners.

The amount of any undeclared income will not be known for many months, but the ATO is confident the cost of the exercise will be more than offset by clawing back unpaid taxes, and fines.

More than 15,000 individuals and 1000 companies will eventually be checked, starting with an initial sample of 1000.

Not even some of Australian music’s biggest names, such as international sensations Gotye or Sia or enduring favourite Guy Sebastian, will be exempt from the scrutiny of the taxman.

Hundreds of unknowns will also be caught in the crackdown.

Companies producing music CDs, DVDs, albums and digital music will also be checked.

Due to the high public profile of many musicians the ATO plans to restrict access to the records to a small group of investigators who will undergo additional security clearances.

ATO Assistant Commissioner Darryl Richardson said the Music Industry Royalty Payments Data Matching Program aimed to detect those failing to declare royalty earnings or to meet superannuation or registration obligations in the industry.

“This data matching program will assist the ATO to identify taxpayers that may be operating outside the taxation and superannuation systems,” he said.

“It’s helping us ensure that there is a level playing field for all taxpayers. Not only by identifying those who are deliberately doing the wrong thing but also by helping us to provide people who want to do the right thing with the information they need.”

The ATO has obtained royalty collection and payment records from the Australasian Performing Right Association, Australasian Mechanical Copyright Owners Society, and their New Zealand equivalents.

APRA refused to comment on the crackdown on its members.

These payments will be electronically matched to tax records to detect cases that warrant further investigation, including instances where royalty and copyright income has not been declared or where royalty income has been “washed” through another entity to minimise tax payable on an individual’s income.

The records of composers, song writers, lyricists, music publishers and copyright owners music will also be used to develop a profile of the music industry, including any risks and trends of noncompliance.

“Based on this analysis we will tailor our compliance approaches,” Mr Richardson said.

The ATO expects the cost of the program will be more than offset by the extra revenue and fines.

Originally published as Taxman chases Aussie hit makers
www.news.com.au/entertainment/music

Leave a Reply