If you earn income by providing short term accommodation or taxi travel (including ride-sourcing) then you will be subject to the new reporting regime that takes effect from 1 July 2023.
What is the Sharing Economy Reporting Regime (SERR)?
Known as the ‘Sharing Economy Reporting Regime (SERR)’, from 1 July 2023 the electronic distribution platforms that you sell through will be required to collect and report seller transactions to the Australian Taxation Office (ATO).
This regime will not change the way you report your income or the way you provide your services, but it may mean that you will need to provide the platform you sell through some extra information so that they can meet the new reporting requirements.
What Information Will I Need To Provide Under the SERR?
Information that the platform will be required to gather from you as part of the new reporting requirements will include:
- ABN and business name (where applicable);
- First, middle and surname (for individuals);
- Date of birth (for individuals);
- Residential or business address;
- Email address;
- Telephone number/s; and
- Bank account details.
What will the ATO do with this information?
In collecting this information, the ATO will be able to complete data matching activities to ensure that providers are declaring the correct level of income and activity from the services they are providing. In addition to this, the ATO has published that from the data they will be able to:
- Increase community confidence in the integrity of the tax and super systems;
- Identify and educate participants who fail to meet their registration or lodgement obligations and help them comply;
- Gain insights from the data to help them develop and implement engagement strategies to improve voluntary compliance; and
- Obtain intelligence to increase their understanding of behaviours and compliance profiles of participants in the sharing economy.
Which Digital Platforms Are Required To Report Under the SERR?
The platforms that must report under SERR are those that operate an Electronic Distribution Platform (EDP). An EDP is a service that:
- allows sellers to make supplies available for buyers (eg. guests booking accommodation or passengers booking car rides); and
- is delivered via electronic communication.
A seller is an entity that makes supplies via an EDP. A buyer is the end user of the supply.
An EDP can be, but is not limited to:
- a website;
- internet portal;
- Gateway;
- Application;
- Online store; or
- Marketplace.
The types of transactions that will need to be reported by EDP operators will include transactions when a seller uses the platform to make a supply that is connected with Australia and the supplies are available to end users and payment/consideration is received for the supply. This will include:
- Ride sourcing;
- Short-term accommodation;
- Hiring (not selling) of assets; and
- Services made available through the applicable platform.
What Action Do I Need To Take To Comply With the SERR?
It is important to note that the SERR does not change how you as a taxpayer go about your affairs. The only action you may need to take will be to provide your EDP provider with some extra information to allow them to comply with the changes. Should you be requested to provide further information to your provider, please ensure it is done so in a safe and secure manner so as to protect your private information.
If you would like further information on the SERR, please visit the ATO’s website. Additionally, if you have any questions on this reporting regime or on the Sharing economy in general, please contact your Davidsons team member on 03 5221 6399 or info@davidsons.com.au.
This article was written by Tax and Business Services Director Kylie McEwan.
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Disclaimer: This information is of a general nature and should not be viewed as representing financial advice. Users of this information are encouraged to seek further advice if they are unclear as to the meaning of anything contained in this article. Davidsons accepts no responsibility for any loss suffered as a result of any party using or relying on this article.