The ATO has the gig economy in its sight.

There are concerns within the ATO that income people earn through various gig economy (or sharing economy) jobs such as Uber driving, Airbnb hosting and food delivery services is not being reported correctly in their tax returns.

To alleviate this problem and ensure that gig economy workers are correctly meeting their tax obligations, the ATO will introduce a reporting regime that requires the Operator of the service (i.e Uber, Deliveroo, Airbnb, etc) to report information directly to the ATO. The information that the ATO receives from these Operators will then be cross-referenced to the Taxpayer’s tax return to ensure that gig economy income is being declared.

Draft legislation has recently been released outlining the details of this new reporting regime and the expected commencement date is:

• 1 July 2022 if it relates to a ride-sourcing or a short-term accommodation service (unless an exemption applies); and
• 1 July 2023 for all other reportable transactions (unless an exemption applies)

This crackdown on the gig economy and the introduction of the reporting regime is similar to the crackdown on cryptocurrency which required cryptocurrency exchanges to report similar information to the ATO. Prior to this, the crackdown on tradies/contractors receiving cash payments resulted in the introduction of the Taxable Payments Annual Reporting system.

For anyone out there earning income through the gig economy, the message from the ATO is simple – if you earn income on the side then make sure that income is inside your tax return.

If you receive income through one of these sources and you’d like to discuss how it should be treated for tax purposes, please do not hesitate to contact your Hall Chadwick QLD representative.