Are you a recording artist who makes your income from your music output? Well consider this caution: declare or beware.
The Australian Tax Office (ATO) is cracking down on non-compliant taxpayers in the music world and is beginning its search for tax cheats with a royalty payments list of of over 15,000 music-makers and 1,000 companies – supplied by APRA AMCOS.
According to The Music Network, the royalties collection agency has (as is expected of them) complied with the ATO’s requests for financial statements of its large member base, providing details of nearly $800 million in royalty collections and payments for the last three year financial years.
The ATO will now be matching it existing tax records with the APRA AMCOS records to identify instances where artists, companies, bands, and other members have dodged declaring royalty or copyright income, or where their incomes have been potentially laundered through another entity to minimise payable tax.
Starting with an initial sample of 1,000 music industry members, the ATO crackdown will be looking across many tax accounts regardless of status – from international chart sensations (eg. Gotye, Sia), to smaller independent artists, and companies producing digital and physical records.
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“This data matching program will assist the ATO to identify taxpayers that may be operating outside the taxation and superannuation systems,” ATO Assistant Commissioner Darryl Richardson tells News Corp.
“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,” he continues. “Based on this analysis we will tailor our compliance approaches.”
The ATO expects that the cost of conducting its wide search for music industry tax cheats will be offset by the extra revenue and fines it expects to find.
APRA AMCOS has not officially commented on ATO’s crackdown, but issued an ‘Important Reminder‘ notice on its official website that reads:
“As per our communication to you in early June this year, your APRA AMCOS royalties are considered income for tax purposes and must be declared in your tax return. The Australian Taxation Office routinely requests audits of our members royalty earnings and, as per our legal obligations, we have again complied with the ATO’s request this financial year. We recommend you speak to your personal tax advisor for more information.”
