THE taxman is expanding its scrutiny of retailers who sell their goods on eBay, in a bid to catch businesses who fail to report all their income.
As the booming online retail sector avoids much of the gloom affecting ''bricks and mortar'' stores, the Australian Tax Office and Centrelink have asked eBay for personal records of all sellers with turnover of more than $20,000 in 2010-11. The ATO also plans to increase sharply the number of audits of eBay users to detect businesses that may be dodging tax laws.
When it arrived in Australia in 1999, eBay was mainly an auction site for second-hand goods, but its sales are now dominated by new goods sold at a fixed price.
The Tax Counsel at the Institute of Chartered Accountants in Australia, Yasser El-Ansary, said the ATO's data-matching efforts also extended to records held by banks, companies that paid dividends and other government agencies.
''The ATO is focusing more and more on third-party information sources to verify whether or not taxpayers are disclosing all of their income on their tax returns,'' Mr El-Ansary said.
Mr El-Ansary said the compliance push could also uncover valuable information about the online industry, which is being investigated as part of a Productivity Commission inquiry.
The ATO began collecting data from eBay last July and has since reviewed 500 online sellers, but it aims to review a further 2,000 sellers in the 2011-12 financial year.
Online retail sites have largely bucked the slump in consumer spending this year.
The largest 2000 businesses on the Australian eBay site enjoyed a 38 per cent surge in revenue in 2010, with turnover ranging from $120,000 to $12.6 million.
The ATO's compliance program will cross-reference at least 500 million transactions from other parties such as eBay.
As the booming online retail sector avoids much of the gloom affecting ''bricks and mortar'' stores, the Australian Tax Office and Centrelink have asked eBay for personal records of all sellers with turnover of more than $20,000 in 2010-11. The ATO also plans to increase sharply the number of audits of eBay users to detect businesses that may be dodging tax laws.
When it arrived in Australia in 1999, eBay was mainly an auction site for second-hand goods, but its sales are now dominated by new goods sold at a fixed price.
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The US-owned site is required to hand over details of annual sales and volumes to tax authorities, who will check the data against income declarations. The scrutiny is also designed to determine whether eBay sellers are engaging in a hobby or a fully-fledged business.The Tax Counsel at the Institute of Chartered Accountants in Australia, Yasser El-Ansary, said the ATO's data-matching efforts also extended to records held by banks, companies that paid dividends and other government agencies.
''The ATO is focusing more and more on third-party information sources to verify whether or not taxpayers are disclosing all of their income on their tax returns,'' Mr El-Ansary said.
Mr El-Ansary said the compliance push could also uncover valuable information about the online industry, which is being investigated as part of a Productivity Commission inquiry.
The ATO began collecting data from eBay last July and has since reviewed 500 online sellers, but it aims to review a further 2,000 sellers in the 2011-12 financial year.
Online retail sites have largely bucked the slump in consumer spending this year.
The largest 2000 businesses on the Australian eBay site enjoyed a 38 per cent surge in revenue in 2010, with turnover ranging from $120,000 to $12.6 million.
The ATO's compliance program will cross-reference at least 500 million transactions from other parties such as eBay.
Read more: http://www.theage.com.au/national/business-or-pleasure-its-a-taxing-question-for-ebay-sellers-20110701-1gv81.html#ixzz1QwNosoOF
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