Whatnot - 2024 Tax guide - Australia

This guide has been prepared by an independent third-party law firm.  Every buyer’s and seller's situation is unique and so are their specific tax circumstances. The below stated information should not be considered as tax advice, but as a general overview of relevant tax rules. Whatnot does not provide tax advice for individual situations, and therefore we strongly recommend speaking with a professional tax advisor for tailored advice.

 October 2024

AUSTRALIA – TAX CONSIDERATIONS FOR AUSTRALIAN RESIDENT WHATNOT SELLERS

Hey there! If you’re a seller based in Australia and want to sell stuff through Whatnot, let’s talk taxes. 

Taxes can be tricky, and therefore you should keep up to date with your tax obligations and remain tax compliant. The timely preparation, filing and payment of taxes are your responsibility per the Whatnot Terms of Service.

As an Australian seller, make sure you are on top of the taxes that may apply to you, such as:

• Goods and Services Tax (GST)
• Income taxes

Just a heads-up: this guide covers income tax and GST for Australian resident individuals who are sellers on Whatnot. If you’re not an Australian resident, or if you're a company, it’s a different story. 

The info in this guide isn’t all-inclusive and definitely not legal or tax advice. If you’re not sure on your local tax rules, it’s a good idea to double-check with your tax authorities or chat with a professional to get advice that is tailored to you. Whatnot cannot help you out with questions about this guide as it’s intended as a "for your information" on some considerations that you may need to be aware of.  

Just so you know, we don’t refresh this info on the fly, soo it's best to verify if there’s been any recent changes to the laws and procedures.

GST

Goods and Services Tax ("GST") can get tricky, so make sure you understand the rules as they relate to your specific situation.

When selling and shipping goods, the GST rules vary depending on a number of factors, including the location of the goods transacted and location of the buyer:

• Australian buyers: Australian GST rules will apply if the goods are already within Australia. 

• Buyers outside Australia: For sales to buyers with exports out of Australia, your sale may qualify as GST-free in certain circumstances. However, GST or VAT rules in the buyer's country may apply to you. 

Below you’ll find more information on these categories.

SELLING TO AUSTRALIAN BUYERS

Do I need to charge any GST to Australian buyers if I am selling items on Whatnot?

If you’re providing goods or services in the course or furtherance of your enterprise that you carry on, you may need to register for GST, charge GST to your buyers, and pay this GST to the Australian tax authority.  In Australia, most goods attract GST.  But, this is only if you meet the GST registration turnover threshold.  

Being GST-registered means you would also have to issue tax invoices and file periodic Business Activity Statements (BASs) to the Australian taxation authority.  As you can see, there's a few GST obligations which you may need to think about.  

Now, to the GST registration turnover threshold.  If your GST turnover from your enterprise is less than (and isn't likely to exceed) 75,000 in any rolling 12 month period, you shouldn't have these GST obligations … but you should always keep an eye on this threshold!  Make sure you also include sales made outside of the Whatnot platform when calculating this threshold.  This is because ultimately, you would be responsible for paying any GST on your sale if it's due. Here is some further information on when you might become required to GST-register.  

Will GST be charged on Whatnot's fees to me?

If you have an Australian Business Number and you are registered for Australian GST you should provide us with this information through the Seller onboarding process. In such case, Whatnot will not charge Australian GST to you on our service fees. 

I exceed the AUD 75,000 GST registration turnover threshold. How do I calculate how much GST I need to collect from Australian buyers? 

Congratulations!  You must be doing great!  

The current GST rate in Australia is 10%.

Keep in mind, the price you list must include the GST portion already. Think of it like the final price with everything added in.

So, if you're listing something for $110, the GST portion will be $10.  You can just divide the listing price by 11, and that'll be your GST amount!  

If you aren't already GST-registered but you have met the registration test, then you must GST-register.  

I exceed the GST registration turnover threshold. How do I collect GST from Australian buyers?

If you exceed the $75,000 registration turnover threshold, you’ll need to collect GST from Australian buyers, then report and pay that GST across to the Australian Tax Office (ATO) through your Business Activity Statement.  

Like we said above, your price to the Australian buyer must include the GST portion already.  So if you charge $110 to an Australian buyer, $10 of this is GST and will be owed to the ATO.

In terms of reporting and paying the GST across to the ATO - you will be required to file a Business Activity Statement once per quarter (i.e., January – March quarter, April – June quarter, and so on).  If lodging quarterly, the due date is generally 28 days after month-end, however sometimes you can be eligible for an extension.  Check out this link for further information on reporting.  

Now, sometimes there's paperwork involved, like receipts or invoices with all the GST details spelled out. If you are required to issue a tax invoice (because you are asked to provide one from the buyer), there are some specific things you have to include on an invoice by law. This includes your details and ABN, sometimes the customer's full information too, the date, what you supplied and how much it was, as well as the GST portion. Here is the ATO's article on tax invoices for further information.  

If this sounds complicated, don't worry. Just ask a local expert to make sure you're on the right track. 

SELLING TO CUSTOMERS OUTSIDE OF AUSTRALIA

When you sell things to people outside Australia, you may not need to charge Australian GST if you export the goods from Australia within 60 days of one of the following, whichever occurs first:

• you receive any payment for the goods
• you issue an invoice for the goods.

However, you should check if any GST rules in the buyer's country apply to you.

As with all things tax, this is very fact dependent!   So do verify if and how this exemption can apply to your export sale.  Heads up, though: if you're GST-registered (or required to be), you still have to report this sale on your Business Activity Statement as a GST-free sale. You also have to keep track of all documents to substantiate your decision to treat the export as GST-free.

PERSONAL INCOME TAX

If you made money selling things through Whatnot, you might owe personal income taxes on that income. This guide will give you the lowdown on what taxes might apply and how to pay them to the ATO.

Australia's tax year runs from 1 July to 30 June.

What are the contact details of the ATO?

The ATO contact details usually depend on the subject of your query. See more on this here.

Which Income Taxes are there?

If you make money from selling items on a marketplace, you may be subject to income tax on these amounts and required to file an individual income tax return. You might also be subject to income tax on your capital gains. 

Whether you have to pay income tax depends on whether your Whatnot sales are regular or just occasional selling. Regular selling with the intent to make a profit is generally considered a business and gets taxed differently than one-off sales of your old stuff. Think of it like having a garage sale on a weekend vs. a side gig of regularly selling online.

This is for those of you who are selling on Whatnot all the time, turning it into a regular thing. If that's you, the money you make might be considered business income, which means different tax rules.

Here's why:

• Running a regular shop on Whatnot, trying to make a profit, is like having your own mini-business.
• This is different from just selling off your old stuff here and there, which normally wouldn't count as a business.

There are other factors that can indicate whether you are carrying on a business, so it's best to check with a local expert to make sure you're on the right track with taxes.

If you're not running a full-blown online business (for example, buying and reselling stuff regularly), you might still owe some income taxes on your capital gains depending on what you sell:

• Getting rid of everyday things you use? Australia usually doesn't tax you on that, depending on how much you originally bought it for. Think your personal clothes, furniture, your old phone.
• Selling fancy stuff like art, antiques, or jewelry? These might get taxed differently.

If you make capital losses from selling these things, there are rules that restrict your ability to use those losses. 

In addition to your individual income tax return, you may also be required to file installment activity statements throughout the income year.  Installment activity statements essentially require you to make regular prepaid installments of your estimated annual income tax liability.  The ATO will generally notify you if you are required to file installment activity statements.  Please see further details below. 

What are the Australian income tax rates?

Australian income tax is levied at rates rising on a sliding scale. The exact rate depends upon the amount of total taxable income you have. For the year ended 30 June 2025, the income tax rates for individuals are*:

*Please note that these rates and amounts may change every year, and you should keep an eye on this.

In addition, a Medicare levy of 2% is payable. Relief from the Medicare levy may be available to certain low-income earners.  If you are required to pay the Medicare levy, you may also have to pay an additional Medicare levy surcharge if you and your family do not have an appropriate level of private patient hospital cover and you earn above a certain income.

How do I work out the taxable profit?

If you’re still reading, it’s likely that you may be thinking that, based on the explanation provided above, your sales activities on Whatnot may give rise to ‘business income’, or alternatively a ‘capital gain’ or ‘capital loss’. If this is the case, you’ve probably looked at the tax rate table above and wondered how your Whatnot sales fit into your taxable income.

If you think you have generated business income, this ATO page is helpful in understanding how the calculation works. As a starting point, you’ll want to know how much profit you have made from your Whatnot sales, which will require subtracting eligible expenses and costs from the revenue you have received from your Whatnot sales. This ATO page gives guidance on what sort of expenses and costs you might be able to deduct. If you have calculated that you have made a profit, then this business income will form part of your taxable income for the purposes of the income tax rates set out above. 

If you are not carrying on a business and you think you may have generated a capital gain or capital loss, this ATO page provides a general overview to assist you in understanding how the capital gain or capital loss will affect your taxable income for the purposes of the above income tax rates. 

What are my Australian income tax obligations for foreign income?

As an Australian tax resident, you are required to declare income you earn anywhere in the world in your Australian tax return. If you have paid tax on the same income in both Australia and a foreign country, you might be entitled to a foreign income tax offset credit, so be sure to keep records which substantiate any overseas tax paid. For further detail, review this ATO page. 

How do I report taxes in Australia?

You can choose to prepare and lodge your own tax return, or with assistance from a registered tax agent. Tax returns can be lodged with the ATO by paper or electronically via the myGov website. For further detail on lodgment options, see this ATO page. 

You may also be required to file installment activity statements throughout the income year, in addition to your individual income tax return.  Installment activity statements essentially require you to make regular prepaid installments of your estimated annual income tax liability.  The ATO will generally notify you if you are required to file installment activity statements.  Whether you are required to file installment activity statements may be impacted by whether you are registered or required to be registered for GST, as discussed above. 

By when do I have to file returns?

Normally, you have until 31 October following the end of the tax year to file your income tax return (this deadline may be extended if you use a tax agent). 

Where applicable, installment activity statements are generally required to be lodged on a more regular basis (for example, quarterly). 

By when do I have to make the payment? 

You won't know exactly how much tax you owe in Australia until the ATO finishes looking at your return. They'll send you a bill (called a notice of assessment) with the amount you owe.  In some cases you may be entitled to a tax refund (for example, if you have had excess tax withheld from your other sources of income, such as your salary). If you owe money to the ATO, the date by which you have to make the payment depends on when you lodge your return.

Which records do I have to keep?

You are required to keep records to support your tax affairs. Keeping records will also make understanding and meeting your tax obligations much easier. If you are wondering what sort of records you are required to keep, or the form that your records should take, you may find this ATO page helpful. 

Your record keeping obligations may be different if you are carrying on a business (more information can be found here).