Social media influencers and people with side hustles will come under scrutiny this tax season as the Australian Taxation Office cracks down on businesses amid the cost-of-living crisis.
From July 1, tax officials will use sophisticated data-matching and analytical tools to catch taxpayers who under-report their income.
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As people find new ways to make money due to rising inflation, ATO Assistant Commissioner Tim Loh said it was important for anyone supplementing their income with side gigs to pay the correct amount of tax.
“While there are always new and different ways to make money, the tax obligations remain the same,” Loh said on Friday.
“Don’t fall into the trap of forgetting to include all your income thinking the ATO won’t notice.”
Side hustles include everything from earning money online through digital platforms such as YouTube and Instagram, to ride-share or food delivery services.
Loh said it was sometimes hard to tell if a side hustle is technically a business, and not every money-making gig is considered to be a business.
The ATO will launch a new advertising campaign to help taxpayers better understand their obligations if their side hustle is making money.
“It doesn’t matter whether you are carrying on a business or simply earning additional income through a digital platform, such as a website or even an app, you must keep accurate records of your income and include it in your tax return,” Loh said.
“Every dollar dodged is a dollar that can’t be used for vital services like health and education.”
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The Sharing Economy Reporting Regimen will kick off in July, giving the ATO access to data from more electronic distribution platforms.
The ATO will match this information with the information taxpayers provide on their tax return or activity statement to identify income that has not been included.
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