EOFY info to tax office

[jellybirddesigns]

Does anyone know if it is Ebay or Paypal who sends end-of year financial information to the tax office?

I was just wondering because we have two seller ID's in our house.

This account is in my name where I make things to sell and which I will declare to the ATO, the other account is in hubby's name and is for our everyday stuff around the house.

However they are both linked through to the same Paypal account for ease of use.

For end of year reporting, obviously we don't want to have to declare regular stuff we've sold from the house, just the stuff that I make and sell for profit specifically.

If it is Ebay who sends the info, then that's fine because only this specific account has gone over the threshold. If it is PP who send the info, then perhaps we will need to open up a separate PP account.

How do others manage their multiple account set up?

[lyndal1838]

The information is sent from ebay and it is only the accounts that have sold over the threshold as set by the ATO each year.

[clarry100]

My wife and I have two ebay stores, an etsy store and our own website.

So we have two payal accounts linked to each of the stores which we independently sell on.

That way we each have our own tax reporting to do and the income is split accordingly.

This was how our tax accountant advised us to set it up.

I think you should be OK as you are because as far as I understand it, it's ebay who report to the ATO not paypal.

The threshold last year was $AUD10K each in total sales income (includes postage of course) so I'm guesssing it will be the same this year. We received an information email from ebay telling us that we had been reported for being over the threshold.

If you get reported then you need to lodge a tax return (or report the income on your normal one) as the ATO will be expecting it from you.

If they don't get it then they will likely ask you for a please explain.

[nevillesdaughter]

My understanding is that it is part of the agreement you enter into with eBay, that any information the ATO request from eBay, will be supplied including trading name, registered user, ip addresses, mutiple account details etc

My accountant was an ATO investigator in a previous life and says that industries/businesses tend to be targetted by type eg eBay small retailers this year, corner shops next year etc, and they usually use an arbitrary cut-off point, say $20,000 in income pa.

Having said that, he said that what trumps all, is that if it looks like a business and smells like a business, it is a business and it's up to the trader to prove otherwise.

Marina.

[chameleon54]

Our house has three selling accounts. One store in my personal name, one store in my wifes personal name and one private account also in the wifes name. The stores are run as businesses and report earnings to the ATO. Each store has its own paypal account, linked to a bank account in the name of the respective owner.

The private account also has another seperate paypal account linked to a different bank account in the wifes name. Although our private account sells personal items, it sells more than the $10,000 per year limit for reporting to the ATO.. I have several sheds full of old vintage car parts, antiques and collectables that I hoarded up 20-30 years ago when they where worthless. I would go to auctions of wrecking yards and garages that had closed down and if you wanted one part you would have to buy a full pallet load of stuff. They have matured nicely and many are now highly sought after and very valuable. I also hoarded glassware, old telephones, signs, sewing machines, basically anything really.

Even though the items have been owned for decades, I will still probably report these as income to the ATO as with all the free listing offers from ebay, sales on this account are getting a bit out of hand.

[jellybirddesigns]

Thanks everyone for their input - that helps a lot.

[jm4221]

All Paypal income is reported at ATO's  request.

[lyndal1838]

It is ebay that reports the ebay income details to the ATO, not paypal.

[jm4221]

Paypal is a bank account.

ATO pulls total financial income data from your paypal and bank accounts.

[lyndal1838]

Paypal is not a bank account....it is a money transfer service.

The ATO gets their details from ebay.  Ebay is requested to report the total turnover by the seller over all their accounts.

The ATO has no access to bank accounts either....the banks report the amount of interest gained on the account, not the amount of money being deposited.