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11 October, 2019

ATO to seize Airbnb hosts’ financial data as part of tax avoidance crackdown

By Christian Fleetwood

Airbnb has advised hosts on the platform that the Australian Taxation Office (ATO) intends to seize their financial data as part of a crackdown on tax avoidance.

As part of the government authority’s data matching program, which was announced last year, sharing economy rental platforms like Airbnb will be required to hand over financial information on their property hosting activity between 2016-17 and 2019-20.

Hosts will be required to provide the ATO their name, address, telephone number, banking details, payment methods, gross rental income, nights booked, and comprehensive property activities.

“We believe that some people using sharing economy platforms are failing to report their income, either on purpose or because they assume their level of activity constitutes a hobby and doesn’t require reporting,” the ATO said in an online statement.

“Our focus is to ensure that people renting a room, their home while they’re away or an investment property through web or app based platforms in the sharing economy understand their obligations.”

In 2016, there were approximately two million individual taxpayers who reported rental income of $42 billion or claimed rental expenses totalling $45 billion, or both, according to the ATO.

“There is an increase in people renting homes, apartments, units or rooms via platform sharing sites to generate income,” it said.

“The increased use of these sites means there is an increased risk of people not understanding their tax obligations when it comes to renting out part or all of their property.”

“The ATO has a particular focus on how we can improve our information to assist individuals to understand the rules around short-term rental income and will expand our use of third-party data to identify omitted rental income and over claimed deductions.

“We also seek to identify taxpayers who use sharing economy rental platforms as a way to disguise their property as being genuinely available for rent by listing the property but not responding to enquiries.”

Airbnb spokesman Brent Thomas told Travel Weekly the company’s system doesn’t always make it easy for people to meet tax obligations.

“As it stands, our challenging and difficult-to-navigate tax system can act as a barrier to ordinary Australians using their homes to supplement their income,” he said.

“Airbnb is committed to making it as easy as possible for our hosts to pay their taxes, along with making it easier for the ATO to do their job.

“As the current rules were written before the sharing economy existed, developing a holistic, light-touch, mandatory data sharing framework is critical for everyone in the sharing economy.”

Thomas added that Airbnb remains supportive of a data sharing framework that not only takes data privacy laws into account, but makes it easier and cheaper for Australians to pay their taxes across all sharing economy platforms.

“We shouldn’t be making it harder for people to supplement their incomes, combat cost of living and help generate jobs,” he said.

Tourism Accommodation Australia (TAA) CEO Michael Johnson said the ATO’s move will “significantly improve transparency and increase equity between traditional tax paying accommodation providers and the largely unregulated short-stay accommodation sector”.

“This is an important development that will result in greater accountability of online accommodation platforms and short-stay accommodation providers,” he said.

The move has also been welcomed by the Accommodation Association of Australia (AA0A).

“We will continue to work with political leaders at state and federal level to extend this approach, which creates greater transparency of the unregulated sector and a fair playing field for us to compete and employee Australians,” AAoA chief executive Dean Long said.

The move follows Western Australia’s proposal to implement stricter short-term regulations. Both TAA and the Australian Hotels Association (AHA) for WA lauded the proposal, but implored parliament to endorse the report’s recommendations.

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Email the Travel Weekly team at traveldesk@travelweekly.com.au

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