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  • #970899
    AR48
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    Hi all,

    I am looking at starting my own business but i am unsure whether it is a hobby or a business. I will be making a craft item and looking to start selling it at craft fairs and also on my own website.

    Can someone advise.

    Thanks!

    #1046703
    AgentMail
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    As soon as you start to sell goods, you are a business. At least in the eyes of the ATO. You can start by registering an ABN in your name. If you want to trade under a certain name eg KraftyBugga or something, you will need to register that business name also. Have a look at the following link, which can give you some more information…
    http://www.business.gov.au/howtoguides/Startingabusiness/Pages/default.aspx

    I would also recommend even though your sales may be cash at the craft fairs, you keep a written log of your sales, just in case the ATO start looking through your accounts at money being deposited.

    Regards,

    Carl
    http://www.agentmail.com.au

    #1046704
    AR48
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    Thanks very much, it was getting confusing reading all of the gov pages about the difference between business and hobbys!

    #1046705
    RapidEntryBiz
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    I cant sit still as the previous blogg was so wrong.
    The ATO says that, in general, you are considered to carry on a business if the activity:

    has a significant commercial purpose or character
    has a purpose of profit as well as a prospect of profit
    is carried out in a manner that is characteristic of the industry
    is repeated, regular or continuous, and
    cannot be more accurately described as a hobby, recreation or sporting activity.

    therefore you need not get an ABN straight away and register a business and all the rest of it if you dont fulfill the above criteria.

    To put it in context, if you crochet hanger covers at night in front of the TV and sell them to your friends and relatives that is a hobby, not a business and even though you are collecting money for your crocheting efforts, you are not carrying on a business.

    Carrying on a business isn’t just selling something for money.

    regards
    Dianne
    Rapid Entry Business Services
    http://www.rapidentry.com.au

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