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marcher5(Newbie)Newbie
9 Sept 2024

My sister and I have started an Etsy shop selling digital wedding templates.


I believe this would qualify as a business rather than hobby as we have repeat sales and want to grow and increase our profit.


I have a few questions:

I pay for all the business expenses, but my sister and I split the profits. Can we both get separate ABNs as sole traders or because there is two of us it would come under a different business category?


For tax time, does my sister need to detail all the business expenses even though she doesn’t pay them, or would she just lodge the profit she receives?


We currently make $200-$400 a month, so I wasn’t sure if there was a minimum amount of earnings before you have to worry about business registration etc.


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TamaraATO(Community Support)Community Support
11 Sept 2024

Hello @marcher5,


Sure, let's work this out with you. 😎


It's up to you whether to use one ABN and run under a partnership, or to keep things separate.


As for deductions, that would also depend on the business structure you end up choosing. 👌


For a sole trader, they wouldn't be able to deduct expenses they don't pay for. Only declare income received.


We have a great article on how to manage your side job to help guide you through any more questions that might come up along the way. 🔎

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Most helpful reply

TamaraATO(Community Support)Community Support
11 Sept 2024

Hello @marcher5,


Sure, let's work this out with you. 😎


It's up to you whether to use one ABN and run under a partnership, or to keep things separate.


As for deductions, that would also depend on the business structure you end up choosing. 👌


For a sole trader, they wouldn't be able to deduct expenses they don't pay for. Only declare income received.


We have a great article on how to manage your side job to help guide you through any more questions that might come up along the way. 🔎

marcher5(Newbie)Newbie
28 Oct 2024

Thanks Tamara.


I have read the linked articles and want to check I am understanding correctly.


My sister and I can both operate as sole traders and just individually lodge our tax returns with our profits and expenses?


Am I correct that we don’t need an ABN until we earn over $75,000? But we would both get our own sole trader ABN once it reaches this?


Thanks

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Etsy - Am I a sole trader? | ATO Community