Make sure you declare your income if you sell online.

The Australian Taxation Office (ATO) is analysing sales by individuals and businesses who have sold more than $20,000 in goods and services on the online selling sites, eBay and The Trading Post since 2007.

If you are running a business through online selling sites, or you have an existing business and are making additional sales through these sites, then you need to include this income in your activity statement and/or tax return. A business that sells via the internet is taxable in just the same way as if it sold via a shop-front, or mail order or telephone. An individual who has a hobby and sells a few items on-line (for more than $20,000), is no different than if selling that item via a newspaper advertisement.

The online selling sites are required to provide the computerised transactions direct to the ATO – without the consent of the seller or the buyer! Businesses and individuals that are under reporting or not reporting income generated from these sources will be detected.

Anyone who may have understated their taxable income in error over the last three years due to online sales is encouraged to make a voluntary disclosure. If mistakes have occurred it will be far cheaper to correct them before requested to by the ATO.

All the data collected is in accordance with the Federal Privacy Commissioner’s guidelines on data matching in Commonwealth administration, with taxpayers confidentiality protected at all times.

To report any undeclared income individuals can:

• Make a voluntary disclosure in writing, electronically or by phone. There are also other methods available in specific circumstances. More information is available on the ATO website.
• Lodge an amended tax assessment by completing the Request for amendment of income tax return for individuals which is available from the ATO website, www.ato.gov.au

If you need to lodge a revised activity statement you can call the ATO on 13 28 66 to obtain a revised activity statement form. If you are a registered user revised activity statements are also available from the ATO Business Portal.