There are many way to earn an income, and technology is playing it’s part in the ways people work. However ignorance is not an excuse from the ATO. However you earn your income, it’s still an income and there are obligations you are required to fulfil.
The Sharing Economy and Tax
The internet has opened up so many avenues for earning an income. Drive on the weekends and book with Uber? Rent your tools through Toolmates? Your holiday house through HomeAway or AirB&B? Rent out your caravan through Campify?
Common sharing economy services in Australia include:
‘ride sharing’ services for a fare (Uber, SheSafe, Shebah, GoCatch, Ola and Taxify)
delivery services for a fee (Deliveroo, UberEats, Zoom2u and Sendle)
personal services, including creative or professional services like graphic design and creating websites, or odd jobs like furniture assembly (Airtasker, Expert360, Freelancer, UpWork, Sidekicker, Helping, Hipages, Mad Paws, Mynder and Wipehero).
Third party web sites
If you use a third party web site to do any of those things, you’re taking part in the shared economy. In fact, it’s one of the fastest growing industries in the world today. Savvy you.
It’s not just limited to hiring equipment. Professional and personal services are also a part of the shared economy. Any work that requires specialist skills, like plumbing, accounting, copywriters can be freelanced and is known as the ‘gig economy’.
Powerhouses like Fiverr, Upwork, and TaskRabbit create value by providing a fast, friendly, and secure platform on which people or businesses can find contractors for hire. Freelancers can earn extra money sharing their trade skills and expertise—not unlike owners renting access to their home or car owners sharing rides. It’s an up and coming trend for professional ‘side hustles’.
READ PART 8 – 8 THINGS YOU DON’T WANT TO FORGET THIS TAX TIME
All deemed personal income
However you earn it, it is all deemed personal income. If you provide services or assets through a platform for a fee, you need to consider how income tax and goods and services tax (GST) may apply to your earnings.
If you pay a fee, you’ll be entitled to claim it come tax time but it can get confusing knowing what you can and can’t claim under these circumstances. The good news is that help is at hand. ITP registered tax agents are all over the shared economy and know what you’re entitled to claim – and how.
Tax agents are fully certified accountants who have specialised in tax law. They understand the latest changes and what you need to include on your return – even if you don’t. So, if you’re a side hustler, a renter or a driver, speak to someone who knows.
All ITP The Income Tax Professionals are registered with the Tax Practitioners Board of Australia. Book an appointment and speak to a professional today.
DOWNLOAD THIS ARTICLE: 8 Things You Don’t Want To Forget This Tax Time
Want to know more?
Read Top Tax Income Stream Part 1
Read Top Tax Income Stream Part 2
Read Top Tax Income Stream Part 3
Read Top Tax Income Stream Part 4
Read Top Tax Income Stream Part 5