ATO Targeting eBay Sales, Uber, Airbnb, and More

ATO Targeting eBay Sales, Uber, Airbnb, and More

https://www.hartpartners.com.au/wp-content/uploads/2016/12/HartPartners-ATO-Targeting-eBay-Sales-Uber-Airbnb-and-More.pngBrisbane’s Courier Mail reported recently (10 November 2016), that the Australian Tax Office (ATO) will be harvesting records from eBay seller accounts, to find those who are not reporting large amounts of extra income made online. Back in July 2016, the ATO also announced that it would be targeting people who were skipping their tax obligations whilst earning an income via the sharing economy, utilising services such as Uber, Airbnb, or Airtasker.

Income must be declared

With the emergence of new online and ‘sharing economy’ income sources, more and more people are supplementing their incomes via these channels. Work performed in this manner can be attractive, particularly due to its flexibility – you can choose where you perform the work and during what hours.

And it can be tempting to try to avoid paying tax, with a belief that the ATO simply won’t notice. However it is becoming increasingly risky, as the ATO is now taking a firm stance, with the ability to employ extensive ‘data mining’ strategies to catch you out.

Many people simply don’t realise that they must declare the income they earn from these sources on their tax returns, and land themselves in trouble without meaning to. What begins as a hobby may grow rapidly in to a significant source of income, with earners neglecting to consider the impact this income might and should have on their tax.

Hobby or supplementary income?

Of course we are not talking about those of us who simply sell the odd item on eBay when we no longer need them. Small amounts of cash here and there don’t tend to be an issue. However, the ATO will be concentrating on those who earn larger amounts – roughly $12,000 or more – from these extra income sources. So once your yearly income from these alternative sources ends up being more significant, it is definitely time to get some tax advice about how to start declaring this.

What data can the ATO access?

Don’t be fooled in to thinking you can hide your extra income easily. The ATO has plenty of power, with the ability to download eBay sellers’ personal details and sales history. It can also access bank records and credit card transactions. Combine all this data and it paints a fairly clear picture of who is earning what. If the data they find doesn’t closely match what you declare on your tax returns, it will throw up a red flag, and you can expect the ATO to start asking questions.

What do I do if I have incorrectly declared income?

If you think you may have inadvertently neglected to declare income when submitting your latest tax return, you CAN amend it. You can either contact the ATO directly, do it online via your myGov services, or contact your accountant or tax agent. If you are worried, seeking advice from a registered tax agent is highly recommended.

It is always best to attempt to fix a problem as soon as you become aware of it, rather than staying quiet and hoping the ATO won’t notice. The consequences of the ATO finding out that you have been dishonest (even if you didn’t intend to) can be much worse.

So if you are thinking about generating part of your income from these sources, or if you already are, make sure you seek the appropriate tax advice. Keep accurate records and declare ALL income on your tax returns. If you don’t comply, chances are you could well end up in some very hot water.

The team at Hart Partners can assist you with the relevant requirements for your situation. Feel free to contact us today on 03 9600 3220 to see how we can achieve the best financial outcomes for you.

 

* * * Disclaimer: No person should act on the general information in this article without taking specific advice from a qualified advisor. * * *

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