ATO Cracks Down on Online Sellers Misreporting Income
ATO Cracks Down on Online Sellers Misreporting Income
The Australian Tax Office (ATO) is ramping up its efforts to crack down on online sellers who misreport income in their Business Activity Statements (BAS) and tax returns. In a new data-matching program, the ATO will be receiving details of accounts that make over $12,000 a year, targeting hobbyists-turned-businesses and those not complying with tax obligations.
Amazon and eBay, two of Australia’s top e-commerce platforms, will be required to hand over details of up to 30,000 account holders to the ATO. This move aims to detect unregistered businesses operating in the digital space and ensure compliance among taxpayers who have transitioned from selling as a hobby to running a business.
Meryl Johnston, founder of e-commerce accounting firm Bean Ninjas, highlighted the potential for non-compliance issues among individuals with multiple income streams. She noted that mistakes often occur when income from certain platforms is inadvertently left out of tax declarations.
The ATO’s data-matching program will collect sales data for the 2023-24 and 2025-26 financial years, including personal details and business information of sellers. By leveraging data from Amazon and eBay, the ATO aims to detect discrepancies between online sales and reported income more efficiently compared to traditional brick-and-mortar stores.
The ATO emphasized that the program is not intended for automated compliance activity but rather to support engagement and assurance strategies for voluntary compliance. This initiative follows similar data-matching programs targeting Medicare levy claims and rental bond income.
With the increasing prevalence of online selling, the ATO’s efforts to ensure tax compliance in the digital space are crucial. By leveraging data from major e-commerce platforms, the ATO aims to promote transparency and accountability among online sellers, ultimately strengthening the integrity of Australia’s tax system.