You may not be aware that the Tax Office has employed a team of datamining specialists, or data doctors. Their role is to look online at social media sites such as Facebook and Instagram to determine if what people are posting matches with what they're reporting in their tax returns. Now they're not simply sitting there flicking through feeds, hoping to catch people out. They are however developing models that identify "non-compliers" so that programs do the scrolling for them. Data matching is not an entirely new audit approach for the Tax Office. For years now, they've been matching your tax file number to discover undeclared interests and investments. They've also been data matching registration and stamp duty paperwork for boats, properties and more for income and expense audits. Social media, however, adds a whole new dimension and means that your humble bragging could land you in a whole lot of hot water if you're not being honest either in your posts or in your tax return. Either way, you could be issued with a please explain. That's because what the Tax Office is attempting to catch is nothing new – undisclosed income and dodgy deductions – it's just added a new way to catch you out. So what are they looking for when they're checking out your social media feeds? Business income It might be a Facebook page or a website you've set up for your business that you're not declaring in your tax return. Or you might be stating that you're unemployed but running a business sneakily on the side. Yes, there are occasions when you're testing the waters and what you're doing is still in the murky waters of a hobby versus a business but if not, then be careful. That's because if a potential customer can find you, then the Tax Office data doctors can find you and may issue you with a please explain.

Cash income Income and expenses audits are nothing new but now the ATO is also using social media to discover unreported income. So if you're declaring $80,000 worth of income in your business tax return yet are sending your kids to private schools, posting pictures of your multimillion-dollar home on Instagram and your annual overseas trips on Facebook the Tax Office might do more than just like your post. It may trigger them to start adding up the cost of your lifestyle and trigger an audit to gather more intelligence on whether your spending habits exceed your reported income. Incorrect expenses Your Facebook post might not be revealing undisclosed income but it may exposing a dodgy claim. You might be posting photos of yourself sunning in Bondi on a gorgeous January weekend and yet lodging a claim for an overseas conference for that same time. Or perhaps you're claiming that you never use a holiday house and it's available for rent for the entire year and yet you're posting long weekends spent enjoying it on Instagram. During an audit the data doctors are increasingly mining for red flags to see if your claims match up. If you're concerned the Tax Office is becoming a little too Big Brother you might consider changing the privacy settings on your social media accounts so that access to what you're posting is restricted. That's because the Tax Office only looks at what is publicly available. But with so much information available online including selling your second-hand luxury goods on e-commerce sites you can still potentially be caught out.

Loading Of course, there's also the maxim, if you have nothing to hide then you have nothing to lose. If you are concerned you might not be doing the right thing, the Tax Office is encouraging voluntary disclosures whereby if you're found to not have correctly reported your income or assets then either no penalties or significantly reduced penalties will apply. Melissa Browne is CEO of Accounting and Taxation Advantage and author of Fabulous but Broke.