ATO Request for Data

[clarry100]

This is the first time we have received one of these since we have been trading on eBay.

Anyone else?

[lyndal1838]

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@ironiton wrote:

Ebay are quite happy to help with the ATO's requests,show us yours and we'll let you off paying full cororate taxation.Hand on **bleep** and the little guy wipes it up.

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Do grow up!!

Ebay has no option but to comply with the ATO's requests for information.....it is the law.

And nobody is letting ebay off paying full corporate tax....they are not required to pay anything until the Australian Government changes the law.

Do you really think there is a conspiracy between the ebay and the ATO....maybe you need to find a seller of tinfoil hats.....you need one.

[helenm777]

Just wanted to know how this works?

My Total Sales are listed in US dollars.. do Ebay and the ATO take this into account ...or do I recalculate into AU dollars for tax purposes?

[lyndal1838]

If you are paying Australian tax then of course you will need to know what you have earned in Australian dollars.

I would think you should have converted the total amount received at the time you converted it to AU$...the conversion rate has changed a great deal over the last 2 years.

If in any doubt either ring the ATO or find yourself a good accountant.

[chameleon54]

The exchange rate varies daily. The only way you can use the U.S dollar figure is to record it each three months ( or whatever the rolling figure is for the period ) and also record the exchange rate on that date. I tried to use this but just found it all too hard. There is a  U.S dollar figure given at the bottom of your feedback page I think, but this one is for your total sales on ebay since you joined and would also not be much use for annual sales. The easiest way I find is to record the 30 day sales figure ( or 60 day figure for private accounts ) at the end of each month ( or two months ) . I also keep the 120 day figure every four months and make an averaged allowance at the end of the year for the extra 5 days. ( 3 x 120 days equels 360 days, not 365 days ) . I just use a small note book with a seperate page for each month. I record sales, bulk stock purchases and ebay fees  in the book. I use a seperate credit card to pay for all of my postage and packing costs. I can then just use the card statements for this part of my costs. I use a standardised % to calculate paypal fees, taken from my yearly turnover. This is the simplest, most effective system I can think of and only takes a few minutes each month. It means I dont have to record every transaction, just the monthly totals.

If you havnt kept any records, the only way I can see to get acurate figures now would be to go back to paypal and bank statements and add up each sale individually. Very slow and painfull if you had many hundreds or thousands of sales. You will also have to factor in wether you include postage in your selling price or charge buyers postage seperately.

[bigbrickshop]

Keep it simple. If you haven't already kept records it doesn't take long to put together the last 12 months info.

eBay sales are paid either by PayPal, bank deposit or cash on pickup.

Income:

Print out or download monthly PayPal sales reports which gives you total sales and total PayPal fees

Bank deposit amounts can be picked up from your bank statements

Receipt book for sales paid in cash

Expenses:

eBay fees from your monthly invoice

PayPal fees from your monthly sales reports

Postage from your eBay invoice or C&S reports or PO receipts

Receipts for other expenses - packaging supplies, office supplies, PO Box rental, internet service etc etc

And make sure you do a stocktake at least once a year.

For future use, setup a monthly auto download of all Sold and Archived through File Manager. That way you have a permanent record or all sales and customer details.

[lyndal1838]

Helen's problem is not the lack of records but that she lists in US$.

I would have thought that her records should have been converted to AU$ at the time she received the money as there has been a huge variation in the exchanged rates in the last 2 years.

[lane-ends]

At the end of The day profit is the $au you recieve total minus $au expenses. This should be in paypal statements as long as its set up for AU$, regardless of what $us is showing in Ebay.

Keep in mind you may have refunds and cancelled sales that didn't go via ebay and so will show a discrepency so you need to keep records of those, along with any private items you sell. There is nothing to say everything on your selling id has to be business, just so long as you keep records to show the two apart. Much the same as splitting business/private use expenses.

[yeoldecoinco]

You are correct in what you say, however:

I find it ironic that the ATO chases people on eBay right down to 10K now, whilst they watch eBay shovel 80 million in profits overseas with virtually nil tax.

Too bad I couldn't register my business in Switzerland and avoid the GST and other taxation responsibilities.

One rule for the corporates, another rule for the rest of us.

[lyndal1838]

The ATO is not chasing people down to the last $10,000....that is the cutoff amount that triggers the request to ebay for information.

You are expected to be declaring your income down to the last dollar.

[clarry100]

If the $10K (or whatever figure it is) in ebay sales is your only source of income then if you stay under the tax free threshold you will pay ZERO income tax. You are still required to declare the income on your annual tax return to show them that ZERO tax is payable. So long as your sales income is declared you are all squeaky clean.

However, if you also have a regular 9-5 job then when you add the $xx sales from ebay on top of that then all of it will be subject to income tax at whatever your usual marginal tax rate is.

I think this is what they are more looking for. Those who should be paying tax on it and are not declaring it as income and thus avoiding tax.

The $10K is just the trigger point at which ebay are required to report sellers to the ATO.

Even if your ebay sales are only $100 in a year you are still required to declare it as income. But you will not have been reported to the ATO. If the $100 is not subject to tax for whatever valid reason then your tax accountant will figure that out in your tax return.