The ATO is targeting anyone who earns money from online sources

Australians are being warned that the ATO is tracking online sources of income.

The ATO is targeting anyone who earns money from online sources

The Australian Tax Office (ATO) is gunning for anyone looking to make an extra buck from online selling and the sharing economy sources such as Uber, Airbnb, eBay and Gumtree.

In order to bolster their retirement income, many retirees look to earn extra money by selling second-hand goods online, or by renting extra rooms or second properties through Airbnb.

Tax specialists are cautioning anyone who earns added income from the $500 million-plus ‘sharing economy’ to think about the tax consequences and declare their income, as online payments leave a digital signature that can be easily traced by the ATO’s data-matching technology.

“The sharing economy and online selling have changed the way we do a lot of things, but it hasn’t changed your tax obligations,” said ATO Assistant Commissioner Matthew Bambrick.

“If you earn money from doing odd jobs, such as through tasking platforms, transporting passengers through things like ride-sourcing, or renting out a room or house, you need to declare it because it counts as assessable income.

“Amounts paid for renting out all or part of a house or unit through the sharing economy must be declared as rental income in the tax return.”

Unbeknown to many, the ATO can access eBay accounts, especially those of users with more than $20,000 of sales a year. The ATO also receives around 650 million reports per year from third parties, such as banks and PayPal, and has the power to investigate anything that “doesn’t look quite right”.

Although renting a room on the odd holiday or selling a few items of second-hand clothing may be seen as a ‘hobby’ by the ATO, repeat sales would be deemed as assessable income and, therefore, must be declared. If the ATO believes retirees are earning extra money, it could inform Centrelink who, in turn, could reduce, or worse, cut Age Pensions from those looking to supplement their income.

Online sellers should put some money aside from online earnings to ensure they can pay tax, should the need arise.

Read more at Courier Mail

Do you sell goods online? Do you think it’s fair that the ATO targets people looking to subsidise their income, when it could, instead, use its considerable resources to crack down on multinational tax evasion?

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    COMMENTS

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    MICK
    17th Jan 2017
    11:11am
    Why is it no surprise that the Turnbull government continues to come after the crumbs whilst ignoring the huge corruption, rorts and handouts at the top end. The report yesterday detailing that 8 men own half of the world's wealth tells you a lot about taxation and their ability to avoid it. Even at home we have the 2 top Australians (Rinehart and Triguboff) who own 20% of the national wealth.
    We need a government which forces the top to pay their rightful taxes and not just everybody else.
    WE NEED ANOTHER ELECTION TO CLEAR THE FILTH OUT OF CANBERRA.
    ray from Bondi
    17th Jan 2017
    8:52pm
    here here, there is something wrong with what is going on for sure, there was none of this under the labor masters.
    roy
    18th Jan 2017
    8:01am
    Once we get President Shorten in charge, everything in the garden will be rosy,speaking of filth in Canberra as you were MICK.
    Alexii
    18th Jan 2017
    8:47am
    It's always easier to get taxes from the lower income people than from the wealthy and big business. We lower income people don't have the tax perks of the wealthy, not the "clever" accountants or the means to pay them, and as well the cost of the accountant tends to be more than the tax refund we'd get anyway. Additionally we don;t give huge donations to the political parties. Seniors need to join together to battle for our rights and our security. Seniors United Party of Australia is offering free membership at the moment - not that membership is expensive anyway. Worth considering joining.
    Old Geezer
    22nd Jan 2017
    4:19pm
    Anyone can access all those perks of the rich. All it takes is a bit of research as it is all available to everyone.

    If still in doubt ring the ATO and they will give you advise over the phone which is documented.

    17th Jan 2017
    11:21am
    What a load of rubbish this is, I am selling a lot of my personal items to scale down. These items were purchased by me from my after tax earnings. What is the government trying to do make us all homeless and penniless? One cannot live on the $400 a week pension due to high prices for utilities and car running expenses. Me at nearly 70 has to get an extra $100 per week to live comfortably. In the last election I did not vote for the major parties, we need to stand together on this and get the rorting do gooding pollies out on the street. Also they should be paid the same pension as us and from the retiring age, not when they loose their positions. Only then will they understand what it is like.
    Not Amused
    17th Jan 2017
    11:31am
    You are probably selling your unwanted items at a loss, having paid much more than current used market value for them in the first place.
    As for the people Mick seems to loathe, I don't believe envy or dislike of successful people is a pleasant trait. The "filthy" rich are always the hardest working risk-takers who provide opportunities for others. It's nonsense to promote the idea that the poor will ever be helped by cutting down the rich. There's no such thing as equality in any aspect of human life.
    ray from Bondi
    17th Jan 2017
    8:59pm
    Not Amused: did you see the news about how eight men own half the world's wealth and I am sure they are not shy to use that wealth to ensure they have MORE. Us ants see that wealthy people live their lives without paying their dues like the rest of us, and in a lot of cases their wealth is gained using infrastructure paid for by the financial blood of the disadvantaged.
    Alexii
    18th Jan 2017
    8:43am
    I agree with you, ray from Bondi. Those filthy rich are morally filthy. Don't forget, Not Amused, that many of us have worked very hard, taken risks but have not had the luck that some of the rich have had. Can you really believe that the"filthy rich" really do work a million times harder than most of us? I imagine that many of us, if we inherited a massive fortune as say, did Rinehardt or Packer and so on, we'd also be able to keep on making huge fortunes. I would hope that as most of us have seen the hard side of life we'd be not as morally corrupt as many of these very wealthy and many of our politicians and we could emphasise with the "ants".
    Sam
    5th Sep 2019
    2:01pm
    I agree with you. I have been selling off excess things in my much to crowded house. I went to do my tax and got asked about my paypal income. Considering I am selling things at a loss to what I bought them for to clear out space is ridiculous. To make it worse, it is almost triple the total sales amount that I actually sold. And that is even before fees, postage etc come out. To top it off my accountant says to just declare it and it will be covered by deductions. It's bad enough that I have to declare selling off my own junk as income, let alone declare the excess amount that doesn't even exist. :( I will be the one that ends up with a debt from that said income.
    Rickrick
    17th Jan 2017
    11:30am
    I sell online and am chased every year but after costs are proven to them they leave me alone as I don't make enough
    If you sell online you are running a business and can claim costs
    This data matching sucks
    Sure I might have sales but after Ebay paypal and delivery fees not to mention stock cost any idiot would see I don't make enough but every year I get hounded
    roy
    18th Jan 2017
    8:07am
    I think data matching is fantastic, if you earn money you must pay tax on it and why not?
    Cue MICK to talk about the "Top End of Town."
    Old Geezer
    22nd Jan 2017
    4:19pm
    I agree fred.
    Cat
    29th Jan 2017
    8:40pm
    Rickrick, I would be interested to know how much a person would have to make after costs before they have a reason to hound you, and wouldn't you still have to declare everything you make regardless of whether it is 'making enough' or not? Also do you have to be a registered business to be able to deduct costs associated with the items being sold? There seems to be no official info about this kind of potential income.
    johninmelb
    29th Jan 2017
    9:34pm
    Cat, if you are running a business, ie buying and selling on a regular basis, then that is asessable income.

    ATO is not interested in people like me that sell the odd surplus bit of junk round the house, ie last year I sold a suitcase, a shredder, and a couple of other bits and bobs hanging round the house gathering dust.

    As for making enough or not, if you are running a business you still have to submit a tax return. I ran a business for 4 years and made no profit (dud business long story). I still had to do my tax returns, but I paid no tax, as I had no profit. I still have a huge capital loss carrying forward that I cannot use!

    To deduct costs etc, you have to be registered for GST at very least but probably need to have registered business name to register for GST. Your accountant can point you in the right direction. I don't know, I did everything by the book with the accountant. Keep you nose clean and they don't bother you.
    TREBOR
    17th Jan 2017
    11:52am
    If you sell a small person item online - they can eat it!

    If you are carrying on a business online - front up and pay your dues.

    Mick is again correct - after the crumbs and not the loafers....
    TREBOR
    17th Jan 2017
    12:06pm
    Gina - the only business woman in the world who can walk into $26Bn and turn it into $12Bn in three years.... now there's someone we all need to listen to.....
    KB
    17th Jan 2017
    11:52am
    This is ridiculous. People sell unwanted items online to get rid of things they want. What about garage sales. Will they be included too?The government must stop going after people are struggling and want to make extra income to pay the bilss.
    ray from Bondi
    17th Jan 2017
    9:13pm
    Because a person is struggling is a great reason to go after them with everything, how can they fight back, they do not have the resources of the rich to fight back.
    johninmelb
    17th Jan 2017
    12:06pm
    Nobody read the article again.

    ATO and Centrelink aren't interested in those of us who clear out a few unwanted bits and bobs. I am currently getting rid of junk out of my unit, as it is too hard to keep clean with clutter. Some things take ages to sell if at all, most I get just a pittance for. But $5 is better than taking it to the tip. I reckon I made about $50 in 2016 from gumtree sales - less than a dollar a week.

    If you are running a little business on the side, as many do, AND not declaring income, then of course you are breaking the law. All the rules regarding pensions are clearly spelt out.
    Fliss
    17th Jan 2017
    1:20pm
    Well said/explained johninmelb!!
    Sundays
    17th Jan 2017
    12:10pm
    The ATO website makes it fairly clear whether it is a business or a hobby. Selling your own unwanted items is not running a business and you don't need to declare the income. Buying others unwanted items, doing them up and selling for a profit is a running a business. I'm sorry, but if you are making substantial income (over $5k pa) why shouldn't it be treated as assessable income. A neighbour was making a Motza doing up furniture and selling online, but not declaring the income while claiming Disability Support. This is just cheating to my mind
    Rae
    17th Jan 2017
    2:59pm
    This is one of the reasons that Social Security is fast becoming unaffordable. We all know of a few locals claiming a pension who shouldn't be whether it is the mum living with a working bloke or the OAP earning money on the side doing odd jobs for cash. It is certainly cheating.

    Those savers recently thrown off any support are paying the price for the scammers.
    Farside
    17th Jan 2017
    12:11pm
    Chill people. This activity is directed at people conducting a business, not hobbyists or selling down unwanted items. If you have genuine concerns then keep records for what you are buying and selling, and your costs of doing same. The ATO cracking down on the black economy is a good thing for most people.
    Anonymous
    17th Jan 2017
    12:23pm
    Correct. If you're not running a business, you have to pay 10% GST on all your inputs as regards your item selling - and you can't claim them back, as businesses can. Thus, the taxman is getting his cut, anyway.

    Don't worry about the income from hobby sales, the profit level is low anyway, and the costs associated with selling are heavy.
    Gumtree and eBay are the hungriest operators around, they rake in the money like the Hancocks and the Wrights.
    Anonymous
    17th Jan 2017
    7:49pm
    Hobbyists are also governed by the amount they can earn within a year, so don't delude yourself. Some of the biggest earners, over and above the annual limit, are dog breeders who can net very big bucks depending on breed and pedigrees provided. Council limits on the number of dogs a household may have are often totally disregarded and breeders' income can easily be $30,000+ p.a.
    Farside
    19th Jan 2017
    12:56am
    Fast Eddie, what is the annual limit for a hobbyist before they are taxed?

    I suggest if they are making enough to be taxed the line between hobby and business has been crossed and it is then up to the person to demonstrate it is still a hobby.

    "It's a myth that there is a dollar threshold to be in a business. Some people can have very expensive hobbies! What matters is whether, as a whole, your activity is commercial with an aim to make a profit. If you're in business, there are dollar thresholds that can affect what you can claim for tax purposes." https://www.business.gov.au/info/plan-and-start/a-business-or-a-hobby
    KSS
    17th Jan 2017
    12:42pm
    Yet again people getting all hot and bothered without reading the article.

    The ATO is not interested in your unwanted 'stuff'.

    They ARE interested in those making over $20000 a year because if you are selling that much you are a BUSINESS and should be paying the required tax: rent out your house on Air b&B for a week or two when you are on holiday, no-one cares, but rent out your spare room at $50 a night year round and you are running a business so pay up.

    Incidentally as far as Air B&B and Uber go, if you are offering these 'services' then you should check with your insurance companies. Failure to declare your activity could well invalidate your insurance policy regardless of the amount earned!
    andy mack
    22nd Jan 2017
    6:23pm
    Thank you KSS - your point about cpmmercial activity invalidating an insurance policy is well made.
    dougie
    17th Jan 2017
    12:50pm
    Why does every statement bring out the vitriolic political comments. Make a point, share your thoughts and knowledge but do not demean yourself with such churlish and rabid political rhetoric.

    If you sell on line and make a profit, pay your tax, if you are selling on line to dispose of unwanted items disclose this if questioned, no problem.

    Contributors want to share their posts but many cannot be bothered because of the abuse and name calling that many associate with their desire to post. Why can a positive statement by the convenors be turned into abuse and political party anti government ranting.

    Where are the site administrators that they allow this to happen.
    Now watch the abuse that will be directed at me!
    TREBOR
    17th Jan 2017
    1:12pm
    Cop yer whack fer this then!

    https://www.youtube.com/watch?v=kQFKtI6gn9Y
    Jim
    17th Jan 2017
    4:20pm
    Yes dougie you are correct, everything by some contributors is aimed at posting negative comments against the current government. The article is about folk making an extra few bob selling stuff online, as many contributors have pointed out it is not the folk that are getting rid of a few unwanted items that the government is chasing, it is aimed at the folk that have lucrative sidelines or weekly stalls at your local markets that are been looked at, this has always applied it is not something new that this government has introduced. On the positive side of earning a few extra bob thanks to the previous labor government you can earn up to $18000 per year before you have to pay any tax and that's each person in a couple. I am not sure how much of your pension you lose? I guess you would have to decide if it's worth it for you and yours
    Alexii
    18th Jan 2017
    8:53am
    No wonder the "little" people get upset. The government, the tax office, is letting big business and extremely wealthy get away with paying no tax - hundreds of them - and yet chase the little ones. A great system indeed. But of course, it's always easier to chase the little ones, the low income earners, the pensioners, etc, etc.
    andy mack
    17th Jan 2017
    1:02pm
    Now I have to say there is something not quite right about this story. As far as renting out rooms or cottages this is always going to count as income - but yes, it has gone largely undeclared. Often it is only brought to the attention of the ATO by disgruntled renters etc - say those who did not get their rental bond back for some invented reason.
    NOW - as far as online selling is concerned - if you are buying and selling as a "home business" on any site - with a profit motive - turning items around within 12 months of purchase etc. then YES, you should be liable for a kind of "Capital Gains" tax.
    But if you decide to sell the Rolex watch that you inherited from your grandfather 15 years ago, to my mind, that cannot possibly bring you within the scope of the ATO.
    Indeed - most sellers on ebay and Gumtree post a LOSS when selling their second hand goods of any kind - are they then entitled to claim this as a tax deduction? Of course not. So wake up ATO and wake up Courier Mail/YourLifeChoices and cease scaremongering.
    Mum
    17th Jan 2017
    2:46pm
    I can't believe that people will have to declare what they sell on Gumtree. It's getting to be a police state.
    johninmelb
    17th Jan 2017
    3:53pm
    They won't.

    Try reading the article first.
    LiveItUp
    17th Jan 2017
    6:36pm
    How do they know you make sales on Gumtree? I never admit that I have sold anything even to Gumtree. They only know that I listed something and I never use my real name.
    Anonymous
    17th Jan 2017
    8:21pm
    Bonny, every time you fire up the old PC and get online, you open your identification which is a unique number allotted to your PC by your ISP. If you go into illegal download sites, you can be tracked and prosecuted so it is fairly easy for the ATO to find out who is posting on Gumtree or Ebay or similar. Should you wish to sidestep this problem, you can use a proxy ISP.
    Old Geezer
    22nd Jan 2017
    4:16pm
    If you set up your own gateway to the internet then all your ISP knows is that you have assessed that gateway nothing more.
    Mad as Hell
    17th Jan 2017
    3:31pm
    Australians are loosing Billions in revenue from a poorly legislated Petrolium Resource Rent Tax, only 5 per cent of 150 oil and gas ventures are paying any Petrolium Resource Rent Tax.
    LETS GET THE PENSIONERS.

    17th Jan 2017
    3:40pm
    Cash is King! The ATO has been doing this sort of thing for years. They regularly go through For Sale notices in the paper to see if there is a person or persons who are regular sellers of any particular items and pop around to ask questions. Now they are just getting with technology and chasing sellers online. No conspiracy involved, just the ATO trying to gouge the little battler. Use Gumtree local and ask for cash.
    Jackie
    17th Jan 2017
    5:07pm
    Incredible the lengths these fat cats will go in chasing pensioner entrpreneurship! New Zealand doesnt bother with all this nonsense. They pay everyone the set pension as from your 65th birthday. You just have to declare it at the end of the year, alongvwith whatver income you have, and its taxed/adjusted accordingly. No complicated assets tests or limits, or misersble weeky oversight of peanut income by Centrelink. Much more efficient. They also dont give tax concessions to supersnnuation accounts either, which is making some Australians very rich indeed. Politicians most of all, of course, with their own gold plated scheme with no conditions or restrictions of any kind.
    KSS
    17th Jan 2017
    5:48pm
    If you are an entrepreneur you are a business and so should declare your earnings and pay tax. Simple.
    Dot
    17th Jan 2017
    10:13pm
    The three levels of Government are in a grip of
    TREASON-GREED-CORRUPTION-RORTING
    ABUSE OF POWER
    ABUSE USEAGE OF OUR TAXES AND RATES
    AND THE UTIMATE BETRAYAL OF THOSE WHO SACRIFIED THEIR LIVES FOR THIS COUNTRY.
    Old Geezer
    22nd Jan 2017
    4:12pm
    Since Australia has never declared war on anyone no one has scarified their lives for this country.
    floss
    18th Jan 2017
    4:58pm
    Our P.M.has sold his soul to the big end of town and placed the profit in the Cayman Islands now there is a man we can look down on.
    roy
    20th Jan 2017
    10:25am
    Don't worry looney, President Bill Shorten will make everything in the garden rosy, we don't know where his money's stashed do we?
    There is nothing to stop you putting your money in the Cayman Islands instead of the pokies and the lotto etc.