The ATO has become increasingly sophisticated at identifying undeclared income, with data-matching across platforms including Uber, Airbnb, eBay, and Etsy. Understanding your obligations is important — and the deductions available to side hustlers often reduce the tax significantly.
The key thresholds you need to know
| Threshold | Amount | What it means |
|---|---|---|
| Tax-free threshold | $18,200/year (combined income) | Below this, no income tax |
| GST registration | $75,000 turnover/year | Must register for GST above this |
| Hobby vs business | No fixed threshold | ATO considers profit intent, regularity, and commercial character |
Hobby vs business: the ATO's test
If your side activity is genuinely a hobby (no profit motive, irregular, not commercial), income is generally not taxable and expenses aren't deductible. Once it looks like a business — regular activity, profit motive, systematic approach — it's taxable. The ATO looks at multiple factors, not just profit.
What you can deduct from side hustle income
- Equipment and tools used for the side hustle
- A portion of home internet and phone if used for the business
- Vehicle expenses for business-related travel (not commuting)
- Marketing costs, platform fees, subscription software
- A proportion of home as office if exclusively used for business
- Professional development directly related to the activity
Track your budget in Australian dollars
CashControlly built for the Australian financial reality. 7 days free, no card required.
Start free →Want to actually apply this?
CashControlly helps you turn it into a daily habit. Designed for Australia: super, ATO, HECS-HELP, neobanks and the cost of living.
Start 7-day free trial