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  • Online selling data matching program protocol - 2013-14 financial year

    1 Data matching guidelines

    The Australian Taxation Office (ATO) voluntarily complies with the Guidelines on data matching in Australian government administration (2014) (guidelines) published by the Office of the Australian Information Commissioner (OAIC).

    The online selling data matching program is prepared and published in accordance with these guidelines.

    2 Overview

    The online selling data matching program was developed to increase community confidence in the integrity of the tax system, to promote voluntary compliance, to help protect honest businesses from unfair competition and to assess the level of taxation compliance of individuals and businesses involved in selling goods and services via online selling sites. Online selling data has been collected since 2007-08.

    Details will be requested from Australian online selling sites of registrants who sold goods and services with a total value of $10,000 or more in the 2013-14 financial year.

    The ATO will match the data provided by online selling sites against ATO records to identify businesses that may not be meeting their registration, reporting, lodgment and/or payment obligations.

    3 Purpose and objectives

    Purpose

    The purpose of the online selling data matching program is to protect businesses from unfair competition by identifying taxpayers who are not complying with their taxation obligations.

    The ATO is seeking to obtain external data to cross-reference with its own internal data to identify relevant cases for administrative action, including compliance and educational strategies.

    Objectives

    Objectives of the online selling data matching program:

    • Promote voluntary compliance and increase community confidence in the integrity of the tax system
    • Identify those individuals and businesses that sell goods or services via online selling sites and may not be correctly reporting their business income
    • Identify those apparently operating a businesses but failing to meet their registration and/or lodgment obligations
    • Gain insights from the data that may help to develop and implement treatment strategies to improve voluntary compliance; which may include educational or compliance activities as appropriate
    • Obtain intelligence to increase the ATO’s understanding of the behaviours and compliance profiles of individuals and businesses that sell goods or services via online selling sites.

    4 Agencies and entities involved

    Matching and primary user agency

    The ATO is the matching agency and will generally be the sole user. In very limited and specific circumstances as contained in Division 355 of Schedule 1 of the Taxation Administration Act 1953 the ATO may provide individual records to other agencies, including State and Territory revenue authorities and law enforcement agencies.

    The data matching program will be run on secure ATO computer systems and in accordance with approved policies and procedures.

    Source entities

    A principle based approach has been adopted to ensure that inclusion as a source entity is consistent and transparent.

    Inclusion of data providers in the program is based on the following principles:

    • The data owner or its subsidiary operates a business in Australia that is governed by Australian law
    • The data owner provides an online market place for businesses and individuals to buy and sell goods and services
    • The data owner tracks the activity of registered sellers
    • The data owner has clients whose annual trading activity amounts to $10,000 or more
    • The data owner has trading activity for the year in focus
    • Where the client base of a data owner does not present an omitted or unreported income risk, or the administrative or financial cost of collecting the data exceeds the benefit the data may provide, the data owner may be excluded from the program.

    Following a review of all online selling sites in Australia and in consideration of the criteria above, we will collect data from eBay Australia and New Zealand Pty Ltd.

    The ATO will continue to monitor the online selling market to determine which entities meet the collection criteria and may collect data from new source entities as appropriate. This may involve seeking sample data to test the risk profile of an entity’s client base.

    In accordance with guideline 5.9 the ATO will encourage the source entity to take reasonable steps to notify the general public of their participation in this data matching program. To assist with this, the ATO has:

    • Provided written materials the data provider can provide to its clients advising of their participation in this program
    • Advised the data providers to update their privacy policies to note that personal information is disclosed to the ATO for data matching purposes.

    5 Data issues

    Data elements

    The ATO endeavours to work collaboratively with data providers to ensure that requests for data are easily understood and reasonable in terms of costs of compliance.

    The following data elements, where available, will be requested from the online selling site, in relation to all online sellers with sales of $10,000 or greater in the 2013-14 financial year:

    • Account name
    • Account identification
    • First name
    • Last name
    • Business name
    • Address
    • Telephone numbers
    • Date of birth
    • Email address
    • Registration date
    • Number of annual sales transactions
    • Value of annual sales transactions
    • Number of monthly sales transactions
    • Value of monthly sales transactions
    • Internet Protocol (IP) address
    • Seller status – tier type
    • Business / Store status indicator – yes/no

    Number of records

    The total number of online selling account records to be received is estimated to be between 30,000 and 40,000. The number of affected individuals linked to those accounts is expected to be between 15,000 and 25,000.

    Data quality

    The ATO expects the data acquired will be of high quality as it has been in previous collections. The data owner holds sufficient information about members and their transactions to determine the fees for services provided, receive and make payments, and communicate with sellers.

    When the data is received it is loaded onto the ATO’s secure computer systems. The data will be put through quality assurance processes to ensure it conforms to requirements before matching is undertaken.

    Data integrity

    The ATO has a mature identity matching engine. This ensures confidence in the integrity of the identity matching as the system utilises more than one identifier in the matching process. Combinations of name, address, post code and date of birth are used in the identity matching process. High confidence matches will occur where multiple fields are matched to a high degree.

    It is anticipated that some data will be matched at lower confidence levels where fields are matched to a lesser degree or data is unavailable.

    Where administrative action is proposed, additional checks will take place to ensure the correct entity has been identified. The entities will be provided with the opportunity to verify the accuracy of the information before any action is taken.

    Data security

    ATO staff are subject to the strict secrecy and privacy provisions contained in Division 355 of Schedule 1 to the Taxation Administration Act 1953 and include terms of imprisonment in cases of serious contravention of these provisions.

    All ATO computer systems are strictly controlled, with features including:

    • System access controls and security groupings
    • Login identification codes and password protection
    • Full audit trails of data files and system accesses.

    The ATO will utilise its secure data transfer facility to obtain the data from source agencies.

    6 Discrepancy matching

    Matching process

    The identity matching process is described above under ‘Data integrity’ and is the first step in the matching process.

    Records with a sufficient confidence level in the identity match will be loaded onto another of the ATO’s secure computer systems where data analysts will use various techniques to identify potentially high risk discrepancy matches for actioning within compliance areas. Cases selected for administrative action will be loaded to our case management systems for allocation to compliance staff.

    Lower confidence and unmatched data will be further analysed to attempt to increase the level of confidence in the match rating and identify further cases that may require compliance or educational activity.

    Quality assurance

    Quality assurance processes are integrated into ATO processes and computer systems and are applied throughout the data matching cycle.

    These assurance processes include:

    • Registering the intention to undertake a data matching program on an ATO internal central register
    • Obtaining approvals from the Data Matching Gatekeeper and relevant Senior Executive Service (SES) officers prior to any activity being undertaken
    • Notifying the Office of the Australian Information Commissioner of our intention to undertake the data matching program and requesting permission to vary from the Data Matching Guidelines
    • Maintaining access management logs recording details of who has access to the data, why access is required and how it will be used
    • Processes embedded into compliance activities, such as:  
      • Review of risk assessments, taxpayer profiles and case plans by senior officers prior to client contact
      • On-going reviews of cases by subject matter technical experts at key points during the lifecycle of a case
      • Regular independent panel reviews of samples of case work to provide assurance of the accuracy and consistency of case work.
       

    These processes ensure data is collected and used in accordance with the ATO’s data management policies and principles, and complies with the Office of the Australian Information Commissioner’s data matching guidelines.

    7 Previous programs

    The ATO’s data matching program has been on-going since the 2007-08 financial year.

    As indicated above, we have high confidence in our identity matching processes as we are matching on a number of identifiers.

    The data is combined with other ATO data and used in various analytical models to identify appropriate cases for administrative action.

    These programs have resulted in improved compliance and raised tax revenue. Over 6,000 individuals and businesses have been contacted in prior programs resulting in total tax and penalties of almost $4 million raised.

    The on-going collection of online selling data enables the ATO to review and educate online sellers who are transitioning from hobby status to potentially being ‘in-business’. The ATO has published a ‘Hobby vs Business’ factsheet on ato.gov.au. This factsheet will help online sellers to determine if they are undertaking a business or a hobby and explains the registration requirements for those transitioning to business.

    8 Action resulting from the program

    This program will be used to identify individuals and businesses that may be under reporting or not reporting income and not complying with their lodgment obligations as part of the intent to protect honest businesses from unfair competition.

    Before any compliance action is undertaken, individuals will be given at least 28 days to clarify and respond to the information that has been derived from the data matching program.

    Taxpayers identified as being non-compliant with their taxation and lodgment obligations will be referred to the relevant compliance area of the ATO for action. In some instances it may facilitate debt collection or lodgment compliance activities to address outstanding obligations.

    Action resulting from the program for the period reviewed will ensure that businesses are:

    • correctly reporting their income
    • registered for GST, if required to do so
    • meeting their tax return and activity statement lodgment requirements and any other taxation obligations.

    In cases where taxpayers fail to comply with their obligations, after being reminded of them, the ATO will take action as appropriate and this may include consideration for prosecution. In addition, a risk profile of the taxation compliance of businesses within this group will provide pertinent information to the ATO to determine new and appropriate education and compliance strategies for certain industries.

    9 Time limits applying to the conduct of the program

    The collection of the 2013-14 financial year data under this program protocol is expected to occur in the first half of 2015.

    The ATO is seeking to have the Privacy Commissioner exercise his discretion and allow the ATO to vary from the data destruction requirements contained in the guidelines. The ATO is seeking to retain the data for a period of three years after it is collected on the basis that its retention is required for the protection of public revenue.

    The previous online selling data matching programs demonstrated that access to historical data is crucial for monitoring income tax and goods and services tax compliance and ensuring transactions are being correctly reported. Importantly we are seeking this variation to establish a time series profile of this market. We intend to use this time series to identify emerging trends and risks, particularly where relatively small traders are increasing their sales turnover from a ‘hobby’ characterisation to one where they are approaching the threshold of being characterised as a small business with associated goods and services tax and income tax obligations.

    In addition, the nature of the discrepancy matching that occurs under this program will be, in some instances, iterative. This includes the data being used to generate lodgment reviews with subsequent lodgements then being compared to the transactional data for accuracy. This, in combination with our intention to conduct longer term analysis and risk profiling of the data set, has prompted the ATO to seek a timeframe for the destruction of all data under this program of up to three years from the receipt of all verified data files from the data provider. This timeframe aligns with the requirement to evaluate the data matching program no later than three years after the commencement of operation of the data matching program.

    A full case setting out the basis for seeking this variation to the Guidelines and its impacts on individual privacy is contained in appendix A.

    When data is no longer required it will be destroyed in accordance with General Disposal Authority 24 and/or the Records Disposal Authority 1194 as applicable. All data to be destroyed will be handled securely under the supervision of the ATO’s IT trusted access branch and in accordance with the ATO’s security procedures table for dissemination limiting marker: sensitive.

    10 Public notice of the program

    The ATO will publish a public notice in the Australian government gazette notices, during the week commencing 20 April 2015. The ATO will provide a copy of the notice to the source organisation. A copy of the notice will be provided to the data providers and the Office of the Australian Information Commissioner.

    A copy of the proposed notice is at appendix B.

    The ATO will publish a copy of this data matching program protocol on its website once the gazette notice has been published. It can be accessed from www.ato.gov.au/dmprotocols

    The data provider has been advised they may also notify their clients of participation in this data matching program.

    11 Relationship to lawful functions

    The Commissioner of Taxation has responsibility for ensuring taxpayers meet their taxation and superannuation obligations. Compliance with these obligations is a matter the ATO takes seriously and a failure to address non-compliant behaviour has the potential to undermine community confidence in the integrity of the taxation and superannuation systems and the ATO’s capacity to administer those systems.

    The ATO’s data matching program is one of the strategies used to identity and deal with non-compliant behaviour. Data matching programs also provide a degree of assurance that the taxpayers are meeting their obligations.

    12 Legal authority

    ATO legislation

    The data will be obtained under the ATO’s formal information gathering powers contained in the following legislative provisions:

    • Section 264 of the Income Tax Assessment Act 1936
    • Section 353-10 and 353-15 of Schedule 1 to the Taxation Administration Act 1953 (administering indirect taxes)

    These are coercive powers that oblige the data providers to furnish the information requested. The ATO will use the information for taxation and superannuation compliance purposes.

    Privacy Act

    Data will only be used within the limits on the use of personal information imposed by Australian Privacy Principle 6 (APP6) contained in Schedule 1 of the Privacy Act 1988 and in particular:

    • APP6.2(b) – the use of the information is permitted by an Australian Law; and
    • APP6.2(e) – the use is necessary for the ATO’s enforcement related activities

    13 Alternative methods

    The ATO has considered a range of alternatives to using online selling data to identify businesses or individuals selling goods and services via online selling sites that may be at risk of not complying with their taxation obligations:

    • One alternative source considered is through the payment data collected through the Specialised Payment Systems data matching program. This data has been collected for the first time in relation to the 2013/14 financial year. The limitation of this data is that it does not capture payments made by direct bank transfer, cheques, money orders or cash on delivery, whereas online selling data provides details of all transactions, regardless of payment method
    • There are no current internal ATO data sets that contain the online selling information sought under this program.

    This data matching program will allow the ATO to identify taxpayers that may be operating outside the taxation and superannuation systems. It will also reduce the likelihood of the ATO unnecessarily contacting a taxpayer who is complying with their taxation obligations.

    Data matching is an effective and efficient method of examining records of thousands of taxpayers to ensure compliance with lodgment and reporting obligations that would otherwise be a resource intensive exercise examining records individually.

    14 Costs and benefits

    Costs

    The costs of the online selling data matching program are expected to be minimal in relation to the revenue protected. The costs include ATO resources to:

    • Data analyst resources to identify instances of non-compliance
    • Compliance resources to manage casework and educational activities
    • Governance resources to ensure that the data matching guidelines and Privacy Act are complied with
    • Quality assurance work to ensure the rigour of the work undertaken by analysts and compliance staff
    • Storage of the data.

    Benefits

    Benefits from conducting this data matching program include:

    • Maintaining community confidence in both the taxation and superannuation systems by creating a level playing field, as well as maintaining community confidence in the ATO’s capacity to fairly administer those systems
    • Integrity of the taxation and superannuation systems – there are inherence risks in taxpayers not complying with their obligations, including those that deliberately abuse these systems – this program will assist the ATO in detecting, dealing with and deterring those that are not meeting their obligations
    • Enabling enforcement activity and recovery of taxation revenue – without undertaking this data matching program and subsequent compliance activity there are no assurances that a wider risk to revenue does not exist
    • The ATO having a greater understanding of the businesses operating in the cash economy and being able to cater for these businesses in our compliance and educational strategies.
    • Assisting the ATO to promote voluntary compliance by notifying the public of areas and activities under scrutiny, despite some negative perceptions to data matching.

    Appendix A – variation to the guidelines

    The Australian Taxation Office (ATO) is seeking approval for the online selling data matching program to vary from one or more of the conditions detailed in guideline 10 of the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian government administration (2014) (the guidelines).

    The ATO is seeking to retain data for three years from receipt of all data files from data providers. The ATO considers that a variation from the usual retention period for this data matching program is in the public interest as:

    • This variation is necessary for the effectiveness of the data matching program, as outlined in section 8.
    • This variation is necessary to ensure the protection of public revenue.

    The ATO has determined that this variation will not affect the privacy of an individual or entity.

    This program will be subject to an evaluation within three years which is consistent with the requirements of guideline 9.

    Additional information justifying this variation is included in the tables below:

    Table 1 – Matters considered in accordance with guideline 10.2 in seeking this variation

    Table 2 – Consistency with requirements of the other guidelines issued by the Office of the Australian Information Commissioner

    The ATO does not require that this request be kept confidential (guideline 10.6) and has no concern should the Office of the Australian Information Commissioner place this information on its website.

    Table 1 – matters considered in seeking this variation to the guidelines

    Matter considered

    Consideration

    10.2.1 - The effect of not abiding by the specified requirements of the guidelines would have on individual privacy

    • Retaining data for a period of three years will not increase the risks to an individual or entity’s privacy. The ATO has in place very secure processes for handling and storing data. Once acquired, all data will be stored on the ATO secure computer systems where access is strictly controlled and full audit logs are maintained
    • The ATO and its staff operate under stringent secrecy and privacy legislation that prohibits the improper access to or disclosure of protected information. These obligations are supported by significant penalties, including imprisonment. This substantially mitigates the risks of breaches of privacy

     

    10.2.2 - The seriousness of the administrative or enforcement action that may flow from the data matching program

    • An extension of the retention period will not affect the seriousness of the administrative action that may flow from the match, but will assist in detecting non-compliance or taxation fraud
    • Where the ATO proposes to take administrative action where a taxpayer may have reported incorrectly, the ATO will differentiate between those who try to do the right thing and those who set out to deliberately avoid their obligations. Documented procedures, including the Taxpayers’ Charter and Compliance Model will be followed to ensure fairness and consistency

     

    10.2.3 - The effect that not abiding by the specified requirements of the guidelines would have on the fairness of the program – including its effect on people’s ability to find out that basis for decisions that affect them and their ability to dispute those decisions

    • There will be no effect on the fairness of the program or the ability of taxpayers to find out the basis of decisions that impact them or their ability to dispute those decisions
    • Before any administrative action is undertaken, taxpayers will be given at least 28 days to verify the accuracy of the information derived from this data matching program
    • Where administrative action is to be undertaken, we will adhere to the principles established in the Taxpayers’ Charter and compliance model will be adhered to ensure an equitable and consistent approach is taken
    • If a taxpayer does not agree with an assessment, they maintain the right to dispute the decision. They also have the legal right to appeal against those decisions through the courts and tribunals

     

    10.2.4 - The effect that not abiding by the specified requirements of the guidelines would have on the transparency and accountability of government operations

    • There the will be no adverse effects on the transparency and accountability of government operations
    • A program protocol is submitted to the Office of the Australian Information Commissioner and the ATO will strictly adhere to the commitments in that document
    • The ATO will publish a notice with general information about the program in the Australian government notices gazette before data matching commences. The ATO will also make a copy of the program protocol available on its website

     

    10.2.5 - The effect that not abiding by the specified requirements of the guidelines would have on compliance of the proposed program with the Australian Privacy Principles in the Privacy Act 1988

    • There will be no effect on compliance with the Australian Privacy Principles contained in Schedule 1 to the Privacy Act 1988 due to a longer retention of the data. The data collected is solely for the stated objectives established in the data matching program protocol

     

    10.2.6 - The effect that abiding by all of the requirements of the Guidelines would have on the effectiveness of the proposed program

    • The effectiveness of the program would be reduced if the data retention period is not extended
    • There would be a significant reduction in the ability of the ATO to detect incorrect reporting and taxation fraud without understanding and monitoring trends in the data collected
    • The destruction of the data in accordance with the current Guidelines would impact the integrity of the taxation system by:  
      • Limiting the ATO’s ability to identify taxpayers who may be subject to administrative action
      • Resulting in the loss of revenue
       

     

    10.2.7 - Whether complying fully with the guidelines could jeopardise or endanger the life or physical safety of information providers or could compromise the source of information provided in confidence

    • Not abiding by all requirements of the guidelines would not influence or affect the personal safety of any individual identified as part of the program or compromise the source of the information provided in confidence

     

    10.2.8 - The effect that abiding by all the requirements of the guidelines would have on public revenue – including tax revenue, personal benefit payments, debts to the Commonwealth and fraud against the Commonwealth

    • Not allowing the variation to the data retention period of the current program would cause the ATO to miss potential breaches of taxation laws and subsequent non-payment of tax. This would result in the Commonwealth foregoing taxation revenue
    • There are risks to the integrity of the taxation system when people fail to comply with their obligations. Abiding by all of the requirements of the guidelines will reduce the effectiveness of proposed compliance activity. The ATO would miss the opportunity to educate those taxpayers trying to do the right thing, and deterring those that are non-compliant from repeating the behaviour
    • The effect of abiding by all of the requirements in the guidelines could negatively impact on both public revenue and public and government confidence in the ATO. People not complying with their taxation obligations, including those operating outside the system, set a bad example to compliant taxpayers and may encourage their non-compliance. Maintaining community and government confidence in the taxation system is critical to the on-going role of the ATO

     

    10.2.9 - Whether abiding by all of the requirements of the guidelines would involve the release of a document that would be an exempt document under the Freedom of Information Act 1982

    • Only information relating to the taxpayer’s own affairs will be released upon receipt of a freedom of information request

     

    10.2.10 - The legal authority for conducting the proposed program in a way inconsistent with the specified requirements of the guidelines

    • There is no specific legislative power authorising the conduct of this program inconsistent with the Guidelines
    • The Commissioner of Taxation, or his authorised representative, has formed the opinion that this data is required to enable the ATO to effectively and efficiently carry out its legislated functions under the general powers of administration contained in:  
      • Section 3A of the Taxation Administration Act 1953
      • Section 8 of the Income Tax Assessment Act 1936
      • Sections 1-7 of the Income Tax Assessment Act 1997
       
    • The reasons for proposing to operate outside requirements of the Guidelines are detailed above

     

    Table 2 – consistency with the guidelines

    This section outlines where the ATO is consistent with the requirements of the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian government administration (2014).

    Paragraph/guideline

    Action taken/to be taken

    Paragraph 6 - Status of the guidelines

    The ATO has committed to comply with the Office of the Australian Information Commissioner’s The use of data matching in Commonwealth administration 2014 by way of a Chief Executive Instruction.

    Guideline 1 - application of the guide

    The ATO applies the guidelines to all data matching programs where it is anticipated the program will include records of 5,000 or more individuals or entities.

    The ATO recognises that programs with multiple data sources but common objectives and algorithms will be treated as a single data matching program.

    Guideline 2 - considerations before conducting a data matching program

    The ATO conducts a cost-benefit analysis and considers alternate methods prior to proposing to conduct a data matching program.

    Further, the ATO has rigorous governance arrangements, processes and system controls in place to protect the privacy of individuals.

    Guideline 3 - prepare a program protocol

    Prior to conducting a data matching program, the ATO prepares a data matching program protocol, submits this to the Office of the Australian Information Commissioner and makes a copy publicly available on the ATO website.

    When elements of a data matching program change, the program is amended and a copy of the amended protocol provided to the OAIC and republishes it on its website.

    Guideline 4 - technical standards report

    Documentation is prepared and maintained so as to satisfy the requirements of a technical standards report.

    Guideline 5 - notify the public

    The ATO publishes notification of its intention to undertake data matching program in the Australian government gazette notices prior to the commencement of the program.

    This notice includes all of the requirements outlined in the guidelines.

    Notification of the program is also published on the ATO’s website and data providers are advised they can advertise their participation in the data matching program.

    Guideline 6 - notify individuals of proposed administrative action

    Prior to taking any administrative action as a result of the data matching programs individuals and other entities are given at least 28 days to verify the accuracy of the information provided to the ATO by third parties.

    Guideline 7 - destroy information that is no longer required

    The ATO is seeking to vary from this requirement.

    Guideline 8 - do not create new registers, datasets or databases

    The ATO does not create new registers or databases using data obtained in the course of a data matching program.

    Guideline 9 - data matching program evaluations

    Programs are regularly evaluated and always within 3 years after the commencement of the data matching program. These evaluations are provided to the Office of the Australian Information Commissioner.

    Guideline 10 - variations to guideline requirements

    When the ATO intends to vary from the requirements of the guidelines it seeks the approval of the Office of the Australian Information Commissioner and provides documentation to support the variance.

    Guideline 11 - Data matching with entities other than agencies

    The ATO undertakes its own data matching programs. The ATO does not outsource this function.

    Where data is obtained from an entity other than an individual, the ATO usually does so using its formal information gathering powers. In these instances the entities are advised they are able to notify their clients of their participation in the data matching program.

    Guideline 12 - data matching with exempt agencies

    The ATO does not usually undertake data matching with agencies that are exempt from the operations of the Privacy Act 1988 under section 7 of that Act and that are subject to the operation of the guidelines (i.e. any data matching undertaken with an exempt agency would usually be for fewer than 5,000 individuals).

    In the event the a data matching activity would otherwise be subject to these guidelines except for the exemption status, the ATO would still adhere to the principles of the guidelines and prepare a program protocol, seeking to vary from the guidelines by not publicly notifying of the program and publishing the protocol. The ATO would still lodge a copy of the Protocol with the Office of the Australian Information Commissioner.

    Guideline 13 - enable review by the Office of the Australian Information Commissioner

    The ATO would not prevent the Office of the Australian Information Commissioner from reviewing its data matching activities and processes. These activities and processes have been reviewed by the Australian National Audit Office and Inspector-General of Taxation.

    Appendix B - gazette notice

    Commissioner of Taxation

    Notice of a data matching program

    The Australian Taxation Office (ATO) will request and collect online selling data relating to registrants that sold goods and services of a total value of $10,000 or more for the period from 1 July 2013 to 30 June 2014.

    This acquired data will be electronically matched with certain sections of ATO data holdings to identify possible non-compliance with registration, reporting, lodgment and payment obligations under taxation law.

    Data providers are included in the program based on the following principles:

    • The data owner or its subsidiary operates a business in Australia that is governed by Australian law
    • The data owner provides an online market place for businesses and individuals to buy and sell goods and services
    • The data owner tracks the activity of registered sellers
    • The data owner has clients whose annual trading activity amounts to $10,000 or more
    • The data owner has trading activity for the year in focus
    • Where the client base of a data owner does not present an omitted or unreported income risk, or the administrative or financial cost of collecting the data exceeds the benefit the data may provide, the data owner may be excluded from the program.

    In accordance with this purpose and the principles listed above data will be sought from eBay Australia & New Zealand Pty Ltd, a subsidiary of eBay International AG which owns and operates www.ebay.com.au.

    It is expected that records relating to between 15,000 and 25,000 individuals will be matched.

    This program is called the 2014 online selling data matching program and it will enable the ATO to:

    • Address the compliance behaviour of individuals and businesses selling goods and services via the online selling site who may not be correctly meeting their taxation obligations, particularly those with undeclared income and incorrect lodgment and reporting for goods and services tax, and
    • Be more strategic in its approach to determine appropriate educational and compliance strategies to encourage voluntary compliance for taxpayers in the online selling market to ensure they meet their taxation obligations.

    A document describing this program has been prepared and lodged with the Office of the Australian Information Commissioner. A copy of this document is available at www.ato.gov.au/dmprotocols or by emailing SpecialPurposeDataSteward@ato.gov.au with reference to the online selling data matching program.

    The ATO complies with the Office of the Australian Information Commissioner’s Guidelines on data matching in Australian government administration (2014) which includes standards for data matching to protect the privacy of individuals. A full copy of the ATO’s privacy policy can be assessed at www.ato.gov.au/privacy

      Last modified: 06 Oct 2015QC 43634