Financial advisers that service the needs of high net worth individuals (HNWIs) will need to brace their clients for tougher scrutiny from the Australian Taxation Office (ATO), as it steps up its focus with more audits and reviews to be conducted this year.
Centric Wealth chief executive Michael Pillemer said as a provider of diversified financial services to HNWIs, the ATO's focus on this particular segment would most likely impact some of their clients.
"It is worth noting, the ATO considers an HNWI to be one who controls $30 million of net wealth," he said.
"Whilst increased scrutiny may not be welcomed by our clients, Centric's conservative and robust approach to structuring and investing is designed to insulate our clients against the risk of falling foul of taxation legislation in the areas in which the ATO is focusing.
"In addition, we also work closely with various ATO technical sub-committees to ensure our clients' interests are represented, and that we are at the forefront of interpretative issues in respect of the ATO's administration of taxation law."
Last week, the ATO announced that it planned to expand its focus on HNWIs, such as company executives, directors and individuals with a net wealth of between $5 to $30 million.
ATO tax commissioner Michael D'Ascenzo said there would be more audits, reviews and better coverage of complex arrangements and structures, with 120 audits expected to be conducted during this financial year.
"In addition we also expect to carry out over 650 reviews," he said.
