Private ruling: Am I in business
Date of advice: 28 January 2020
Published: March 2020
Ruling period: Year ended 30 June 2019 | Year ending 30 June 2020 | Year ending 30 June 2021 | Year ending 30 June 2022
Date scheme commenced: 1 July 2018

Ruling: Q1: Does your activity amount to the carrying on of a business? | A1: No. You don't meet the relevant factors contained in Taxation Ruling TR 97/11. While you perform the activities required to run the podcast, the scale, repetition and regularity of your activities and volume of operations is too small to be considered as carrying on a business. It is considered to be more of a hobby that you undertake. Further information about carrying on a business can be found by searching 'QC 31733' on ato.gov.au

Relevant facts and circumstances: You started a podcast focused on a computer game with other enthusiasts. The podcast is free and listeners are under no obligation to pay to listen to the podcast. Listeners can donate amounts per show through a third party platform who take a commission. Listeners are under no obligation to make donations. You are the organiser of the podcast so the donations, less the commission is deposited into your PayPal account. You use these funds to purchase prizes for listeners or equipment to improve the quality of the podcast. During the 2019 financial year you received revenue of a few thousand dollars but the related expenses exceeded this. For the 2020 financial year the revenue is expected to be slightly higher and with similar expenses the activity will be making a small profit of under $1,000. You and the other enthusiasts are not paid a salary/wage for operating the podcast. You have a full time job and in your spare time you spend approximately 3-4 hours per week on the podcast. Your intention for running the podcast is for enjoyment not for profit making.

Relevant legislative provisions: Income Tax Assessment Act 1997 subsection 6-5(1) | Income Tax Assessment Act 1997 section 995-1