Sharing economy reporting system to be implemented
Legislation introduced into parliament will require operators in the sharing economy to report income earned by sellers on their marketplace. This is based on the Australian Taxation Office's (ATO) determination that income earned on these platforms is at a high risk of non-compliance with tax obligations.
Operators who provide ride-sharing or short-term accommodation will be required to report first. From 1 July 2023, your income from these platforms will be reported directly to the ATO as assessable income to include in your tax return.
Transactions from all other types of sharing economy platforms will be reported to the ATO for income years commencing 1 July 2024.
The online operators of ride-sharing or short-term accommodation platforms will be required to submit a taxable payments annual report on your behalf, with the first one due on 31 July 2024.
TAXABLE PAYMENTS ANNUAL REPORT
Until the legislation receives royal assent, the ATO will not provide details regarding the information required in the annual report. However, based on annual reports from other industries, it is expected that the information will include a seller's:
name
address
ABN
gross receipts, and
GST charged on the gross receipts.
RISK MITIGATION STEPS
Using these platforms, your data will likely be included in reports, such as the ATO's Pre-fill reports. This will make it very difficult for you to avoid tax compliance. It is encouraged that you ensure all necessary information is sent to us before the ATO begins amending assessments.
If you would like to know more about these developments, please give us a call. We would be happy to help you through your necessary obligations.
