How do I know if I have a hobby or a business in Australia?

This is a common question for creators and side-hustlers. The ATO looks at several factors to decide if you are running a business: - Do you intend to make a profit? - Do you conduct your activities in a business-like manner (e.g., keeping records, having a business plan)? - Is the activity regular and repetitive? - Is the activity of a significant size or scale? If it's a **hobby**, you don't need an ABN, you don't report the income, and you can't claim losses. If it's a **business**, you need an ABN, you must report income on your tax return, and you can generally claim business expenses. If you're unsure, the ATO has a 'Business or Hobby' tool on their website.

• Business: intent to profit, regular, records kept
• Hobby: private pursuit, no reporting needed
• Businesses must have an ABN and lodge tax returns
• Profit isn't required immediately, but the *intent* must be there
• The scale of activity matters