In 2022, the Government is set to launch a new reporting scheme, targeted at stopping sharing-economy participants from skipping their tax obligations.
What is the sharing economy?
As described by the ATO, the sharing economy is economic activity through a digital platform (ie a website or an app) where people share assets or services for a fee. Some examples include Uber and AirBnB.
Rolling out the new scheme
Under the new scheme, participants will have to adhere to a compulsory reporting regime, which will be implemented by applying the taxable payments reporting system (TPRS) to certain transactions undertaken through these platforms. From 1 July 2022, ride sourcing and short-term accommodation platforms, will be required to report information of all transactions to the ATO.
The new scheme will be rolled out over a number of years, with asset sharing, food delivery, tasking-based services and other services to be included from 1 July 2023.
Greater transparency for all
With the rapid growth of Australia’s sharing economy, it has become increasingly difficult for the tax system to capture transactional data. The new scheme will provide a greater level of transparency for all sharing economy participants. Furthermore, it will help to stop the sector from feeding the black economy, a major concern for the Treasury’s Black Economy Taskforce (established in 2016).