Tax obligations for startup in different countries?

This thread is archived and the information may not be up-to-date. You can't reply to this thread.

(Newbie)Newbie

23 May 2021

I'm hoping to get some advice about my tax obligations as a startup.

In July 2020, I started building an online business from home, as an Amazon.com seller. The business is sourcing products from China, shipping it to the US and selling it on Amazon US. I run it from Australia but no goods ever enter Australia.

It's a little complicated, as I have paid for some things using my AU bank account but the main bulk of payments have been made using a UK credit card. So far, I have spent around $17,000 AUD. The product has not yet gone live on Amazon US, so the business has made $0.

I do not have an ABN. I did have one, from a previous business venture that did not go ahead. My ABN was cancelled by the ATO in May 2019.

So really, what I need to know at this stage is:1. Do I need to do a tax return in Australia, US, UK or any/all of the above?2. Can I claim anything anyway, as I didn't have an ABN at the time of incurring expenses?

Any help would be much appreciated.

0 likes

1,229 views

2 replies

1,229 views

2 replies

Most helpful response

Most helpful reply

_JimmyATO

(Community Support)Community Support

25 May 2021

Hi @Jellybean93

If you're an Australian tax resident then you need to declare your foreign income here. I don't think the UK fits in anywhere. You may be subject to withholding tax in the US, and thus need to complete an IRS W-7 and/or W8-BEN form. For more information about this you should contact Amazon and/or the IRS.

I'd suggest you get your ABN back, as it was a registrar initiated cancellation we can't reapply it over the phone. You'll need to lodge an ABN application through ABR.gov.au . You may be able to backdate your ABN start date to when you recommenced business. You will be able to claim expenses still, likely not as a deduction against salary or wages, but you can carry forward the business loss to a future year when you're making a profit.

You can read more information (I believe Article 7 is applicable to you) about our tax treaty with the US here:

Convention between the Government of Australia and the Government of the United States of America for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income

Hope this has cleared things up.