The ATO recently announced that it is continuing its rental bond data matching program into the 2025-2026 financial year. This program involves collecting the rental bond records of approximately 2.2 million landlords, tenants, and property managers to ensure property owners are meeting their lodgement obligations.  

If you own a rental property, it’s important to understand what this means for you and your tax obligations. 

What is rental bond data matching? 

Data matching is a process where the ATO cross-references information from various sources to find inconsistencies or discrepancies that may indicate underreporting of income. By collecting rental bond details, the ATO can compare the amounts landlords report on their tax returns with the bond amounts lodged with regulators, allowing them to identify any differences that could suggest underreporting. 

This program’s objectives include identifying and educating individuals and businesses that may be failing to meet their registration or lodgement obligations, closing the tax gap, and ensuring compliance across the rental property market. 

What data is the ATO collecting?    

The ATO will acquire rental bond data from State and Territory rental bond regulators bi-annually for the 2024 to 2026 income years. This data includes personal details of landlords, tenants, and managing agents, such as names, addresses, phone numbers, and bank account details. It also covers rental bond transactions, including property addresses, lease periods, bond amounts and refund details. 

The collected data will be matched against ATO records to identify and address taxation risks, such as taxpayers owning income-producing property who have obligations to report the income generated in their tax returns and taxpayers disposing of a property that may trigger a CGT event. 

What errors is the ATO looking for?    

The ATO will be on the lookout for various errors, including: 

  • omission of rental income if you held more than one property 
  • situations where the rental income declared in tax returns is not in the same proportion as the ownership documents 
  • claiming an outright deduction for an asset that may have needed to be claimed over multiple years 
  • incorrect cost base elements when calculating the rental property’s net capital gain or loss (for a capital gain event).  

I own a rental property – what does this mean for me?    

Landlords who comply with their tax obligations have nothing to worry about. However, rental deductions can be complex, and if you don’t understand your tax obligations, now is the time to get on top of them. A registered tax agent can help you understand your tax obligations and ensure you’re up to date with the latest legislation. 

To avoid penalties, you should: 

  • lodge your returns on time 
  • accurately report all your rental income, including short-term and partial-period rentals 
  • claim deductions correctly, understanding the difference between capital works and repair deductions 
  • maintain accurate records of your income, expenses and property transactions.  

If you think you may have misreported rental information in any of your previous tax returns, we can assist you in amending them. Many taxpayers with investment properties can expect to be subject to ATO attention in the coming years, so it’s worth double-checking that your tax returns are 100% correct.  

What are the penalties for non-compliance? 

Landlords who fail to meet their tax obligations face serious consequences, including “please explain” letters, audits, and penalties for underreporting income or failing to declare rental properties. 

Need help understanding your tax obligations as a landlord? 

Our team of experienced tax professionals can help you navigate the complexities of rental property tax. If you have any questions or concerns about the ATO’s rental bond data matching program or your tax obligations as a landlord, please don’t hesitate to contact us by  

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Disclaimer: The information provided in this article is factual in nature and objectively ascertainable and, therefore, does not constitute financial product advice. Importantly, the factual information that has been supplied does not take into account your personal circumstances, objectives or goals.