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Low Doc Loans

The Tax Office has begun auditing a number of taxpayers who have low doc loans but have failed to lodge tax returns or who have disclosed to their lenders income that is substantially higher than that disclosed in their tax returns.

A low doc loan is the term used to describe those loans that do not require tax paperwork to prove income. The lending institution usually charges a higher rate of interest on these loans.

In some of the cases under examination the annual loan repayments exceed reported taxable incomes and in others people with substantial loans had failed to lodge tax returns

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