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In a significant move to enhance compliance, the Australian Taxation Office (ATO) has mandated that e-commerce giants Amazon and eBay disclose details of up to 30,000 account holders. This data-matching initiative aims to identify sellers who may be misreporting income on their Business Activity Statements (BAS) and tax returns.
According to a recent government gazette notice, this program targets users generating over $12,000 in sales. The ATO will obtain personal, business, and account details of these sellers, enabling a thorough examination of their tax compliance.
“The data helps us increase our understanding of the behaviours and compliance profiles of individuals and businesses that sell goods or services via online selling platforms,” stated the ATO.
The ATO's initiative is focused on detecting unregistered businesses operating online and ensuring that taxpayers who have transitioned from hobbyists to business operators meet their tax obligations. Discrepancies between online sales data and reported income will trigger further investigation.
“Where the online selling data reveals discrepancies between online sales and information declared in the sellers' tax returns, we will investigate further,” the ATO confirmed.
Australia's e-commerce industry, valued at $60 billion, sees Amazon and eBay as leading marketplaces. In 2023, Amazon.com.au's merchandise sales reached $4.9 billion, surpassing eBay.
The ATO has a history of conducting online seller data matching programs since 2008. The current initiative will collect data for the 2023-24 and 2025-26 financial years, including sellers' personal details, business names, IP addresses, and sales transaction values.
Meryl Johnston, founder of e-commerce accounting firm Bean Ninjas, highlighted that non-compliance often arises from honest mistakes, such as omitting income from less prominent sales platforms.
“When we start working with new clients, we do see mistakes where sometimes an entire sales platform, particularly if it's not their main channel, will just be left off and not connected to Xero,” Johnston explained. “It's normally a mistake. It's not that people are purposely doing the wrong thing.”
Johnston emphasized that data from Amazon and eBay would facilitate more efficient compliance checks compared to traditional retail operations.
“It would be easier to data match with Amazon and eBay than if you had a shopfront with people making purchases through various payment methods,” she noted.
The ATO assured that the sophisticated systems of Amazon and eBay would provide high-standard data. Collected information will be retained for five years and will not trigger automated compliance actions.
“The program supports the development and implementation of engagement and assurance strategies to increase voluntary compliance, which may include educational or compliance activities. It gives assurance that participants are doing the right thing,” the ATO elaborated.
This initiative follows the ATO's recent data matching programs, including a crackdown on Medicare levy claims and rental bond income compliance.
Stay compliant and avoid unnecessary complications. Contact R J Sanderson today to ensure your e-commerce business meets all tax obligations efficiently and accurately.
This article is published by R J Sanderson and Associates Pty Ltd ABN 71 060 299 783. This article contains general information only and is not intended to represent specific personal advice (Accounting, taxation, financial or credit). No individual personal circumstances have been taken into consideration for the preparation of this material. It is recommended that you obtain your own personal professional advice before making any financial or business decision.