From 1 January 2024, online marketplaces must disclose information about sellers and transactions on their platforms. This makes income earned on digital platforms (also called the sharing and gig economy) more transparent to Inland Revenue if you earn income for services such as:
– providing short-stay accommodation
– providing ride-sharing services for a fare
– sharing assets such as cars, caravans/RVs, parking, or storage space
– providing personal services, such as graphic design, creating websites, or odd jobs like deliveries, pet sitting, furniture assembly or trades services
Inland Revenue distinguishes between the activities above and others, specifying that those below are NOT considered to be part of the sharing economy:
– online selling or classifieds, like Trademe, eBay or Carsales
– cryptocurrency exchanges
– peer-to-peer finance or crowdfunding
But for ALL these activities, if you earn income from them, you need to consider how income tax, GST and other obligations may apply to you. You:
– must declare all income you receive in your tax return
– can claim certain expenses as income tax deductions
– need to keep records of the income you earn and the expenses you incur to earn that income
And from 1 April 2024, online marketplace operators must collect and return GST. This applies whether the seller is GST-registered or not and covers:
– short-stay and visitor accommodation
– ride-sharing and ride-hailing
– food and beverage delivery
If you have any questions please ask us sooner rather than later. Although this is a blanket application, there are many other rules and factors to consider. The rules can be really complex and each situation needs to be assessed on an individual basis.
For more information, Download the free guide to Online Marketplaces – Income Tax and GST.
