Are you an Uber driver, an Airtasker operator or do you earn income from any of the sharing economy platforms? If yes, you should know that ATO is now focusing on your activities, making sure that you correctly declare all your income.
Tax is not often deducted from sharing economy incomes but you still need to pay tax on the money you earn from these platforms.
You have to plan and save early or you may suffer the consequences later on. You should save a minimum of 35 or 40% of your income during your first year to cover for your next tax bill. After this, ATO will start sending you quarterly tax statements to help you manage your taxes better.
“The black economy taskforce refreshed our approach to better leverage data, increase use of community referral information — or “dob – ins” as many would call them — and to continue to follow through on prosecutions for those who are blatantly doing the wrong thing,” Tax commissioner Chris Jordan said. ATO was quick to find out how to assess these sharing economy occupations and the systems are now ready.
The ATO will also focus on work-related deductions so taxpayers may only claim what they are really entitled to.
Employees may not claim deductions for home and work trips unless they have to transport heavy equipment which doesn’t have a safe designated place at work. Uniforms with a distinctive logo or that which are used for protection may often be claimed. However, dress requirements that do not meet these qualifications are not deductible. Mobile and Internet costs relevant to their work may also be partially claimed. The ATO will ensure that these deductions have not been reimbursed by the employer yet as well.
The Australian Tax Office is becoming more hi-tech and sophisticated than ever. It has advanced its data-matching capabilities to benchmark figures by income bracket, occupation and previous returns. They may even contact employers directly. The ATO can also access other government departments, personal bank accounts, sharing platforms and overseas organisations.
Though these measures may not be enough to cover all complex tax revisions, concessions, exceptions and loopholes, at least it could serve as a warning to most people. Tax rules and provisions change frequently and it’s not really a surprise that almost 75% of Australians use tax agents to manage their affairs.
Make sure you keep accurate records and always be ready to back up your claims. For more information about taxes in Australia, contact a Specialist to discuss your particular circumstances.
Chan & Naylor Group has nationwide offices in Brisbane and Capalaba in Queensland, Melbourne and Moonee Ponds in Victoria, East Perth in Western Australia, and Bankstown, Parramatta, Pymble, North Sydney, and Sydney in New South Wales.
Disclaimer: This article contains general information; before you make any financial or investment decision you should seek professional advice to take into account your individual objectives, financial situation and individual needs. Click for more detail regarding this disclaimer.
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