How worried should 'high wealth' families be about continuous threats from the ATO of increased scrutiny of their activities? The budget has allocated an extra $256.9M over 4 years to the ATO to enhance compliance activities, particularly for large businesses and high wealth individuals noted Deloitte Growth Solutions Tax Director Les Szekely.

“What this means in practice is that the ATO will have increased resources to expand both the scope and depth of the work done by its high wealth individuals taskforce,” said Mr Szekely.

The Budget estimates that the increase compliance activity will generate increased revenues of $1.98bn over 4 years.

“Clearly the Government and ATO think they can extract a great deal more tax from high wealth individuals than they are declaring voluntarily under self assessment. What this means in practice is that the trickle of high wealth and risk assessment questionnaires emanating from the ATO will turn into a river if not a total torrent of paper,” said Mr Szekely.

“Given past failures to achieve budgeted revenue from the high wealth individuals programme it remains to be seen whether the extra funding for the ATO will achieve the budgeted extra revenues."

“What is certain is that high wealth families will face increased costs in answering an increasing volume of ATO enquiries. The ATO announced some time ago that it was extending its scrutiny beyond the BRW “rich list’ to all families with assets in excess of $30M.”

“The financial accountants catering for high wealth clients can expect an increased workload in preparing documentation required of their clients by the ATO. Meanwhile 'the wealthy' should be considering whether they have any skeletons in the closet which they might want to voluntarily disclose to an ATO better resourced to investigate them after the Budget,” added Mr Szekely.