Completed 2 paid jobs in 3 months... do i need to register an ABN?

[camerasnoop]

I know this thread is now dead, and Elvis has left the building, but I just want to clarify one more statement above. The Aunt Nellie example is not correct. The very first exemption to deducting witholding tax when no ABN is quoted is where the "payer" (as opposed to the payee), "is not making the payment in the course of carrying on an enterprise in Australia". Aunt Nellie does not have to deduct witholding tax.

Once again, DO consult a Tax Accountant.

[98kellrs]

Without looking at the ATO information of the day, my understanding from when I did go through the whole ABN and GST registration fun a few years ago to set up a business (non photography related) was that if primarily conducted the activities as a hobby with no real chance of making a regular profit (which is pretty hard to do if you're considering the equipment and other costs) then it would be classed as a hobby and your 'free to go on your merry way'.

This was my understanding from the ATO website too. They quoted an example of Joe Bloggs makes furniture from his shed on the weekends and sells a small number per year whilst retaining a full-time job, he is a hobbyist.

Certainly worth checking with a tax accountant though, I'd hate to get slapped with a tax bill for that massive $50 photoshoot

[peterb666]

- deleted -

[camerasnoop]

No, you miss the point Peter. If the person paying the amount "is not making the payment in the course of carrying on an enterprise in Australia", then it doesn't matter whether the photographer is a hobbyist or conducting a business. Auntie Nellie is a private person paying for the wedding. She is not doing it as a business, and is not required to withhold.

See here:

http://www.ato.gov.au/content/38509.htm

You'll notice that link is under the "Business" tab on the website. It's also titled as "A Guide for Business". Deducting withholding tax is something that businesses must do. Private individuals would generally not be required to act as tax collectors. To deduct withholding tax, you must register and show it on your BAS Statement. Aunt Nellie isn't required to complete a BAS Statement.

That exemption refers to the status of the payer, NOT the payee - as I pointed out.

[peterb666]

Correct - missed that bit. So yet another out for the hobbiest and the person making the payment.

[camerasnoop]

Absolutely! And that is why they can undercut the pros in price. So they don't have an expectation of making a profit. They don't have to declare the income (maybe), and no-one has to deduct withholding tax from a wedding payment to them. Those are significant price advantages.

[ice]

right. thanks everyone. off to the accountant then..

[reaction]

a bit late to the party, but I know photographers who have tax withheld by a studio even tho they supplied their ABN

[ricktas]

a bit late to the party, but I know photographers who have tax withheld by a studio even tho they supplied their ABN

Then they should be heading to their nearest ATO office and reporting them/it.

[reaction]

I told them it sounds weird but they 'just claim it back at tax time' with their deductions.

[wheaty78]

I spoke to an accountant about this last year, and I was told that as long as you dont run in a business - like manner (quite a grey area) you are classified as a hobbyist and free to earn money from your hobby.. He said that there wasn't figures set in stone, but rather the way you run that defines you as a business rather than a hobbyist. I would suggest that you discuss your individual circumstances with an accountant.