It seems to be a common misconception that selling things on ebay and other such fun places doesn’t really count as anything much and therefore, no tax needs to be paid.
Oh, if only…
Now sure, this is true for the odd second-hand washing machine that you’ve long upgraded and want out of the garage or for say, a box of records with band names that nobody under 30 has heard off. However, if it looks like a business, smells like a business and runs like a business; the tax office will probably consider it to be a business. And that means, paying tax like a business.
Last night, the tax office produced a media release entitled “ATO’s data matching program focusing on online selling sites“. The heading says it all, really, but going on to actually read the thing reveals that the tax office will be making significant efforts to gather information from sites like ebay and the trading post. They’ll compare that with tax returns and BAS, and hunt down anyone who they think might owe a little extra tax as a result of their online sales.
So, if you’ve been a little over-enthusiastic with the online selling thing but figured that it doesn’t count as income… you might want to talk to us about talking to the tax office. It is entirely possible that your activity may still be considered a hobby, yes, but it’s probably worthwhile making sure that you’re on the right side of the fence before the tax office start asking difficult questions, hey?