Absolutely, yes. The Australian Taxation Office (ATO) uses advanced data-matching technology, bank feeds, and reports from third parties like Uber and PayPal to track undeclared income. Whether you’re Goods and Services Tax(GST) -registered or not, the ATO has systems in place to detect inconsistencies.
Whether it’s from freelancing, rideshare work, drop shipping, or running your own business, ATO can track your ABN Income.
Let’s explore how it works and how you can stay compliant and avoid audits and penalties.
Need help figuring out if you’re reporting correctly? ISM Accountant can help you.
Quick Compliance Check: Is Your ABN Income Properly Reported?
Whether you’re freelancing or running a small business, getting your ABN income reporting right doesn’t have to be complicated. Let’s cover the essentials so you can focus on your work instead of worrying about compliance.
5-Minute Self-Assessment Checklist
Before you check how the ATO tracks your earnings, ask yourself:
- Have I declared all income (even under $75,000)?
- Do I keep records like invoices and bank deposits?
- Am I submitting Business Activity Statement(BAS) (if required) on time?
- Are my business expenses documented and reasonable?
If you answered no to any of these, you’re at risk.
Red Flags That Can Put You at Risk
The ATO looks for signs like:
- Lifestyle that doesn’t match declared income
- Frequent nil BAS returns (with signs of activity)
- Large cash deposits with no invoices or records
These trigger audits and deeper investigations.
Think your income records might raise red flags?
Recommended Read: How to Set Up ABN?
How the ATO Tracks ABN Income in Australia?
ATO knows about your freelance work or side business income. It’s a data matching system that tracks ABN transactions and cross-references records automatically.
1. Bank Data Matching
The ATO has agreements with major Australian banks. All large or frequent deposits into your account, especially with business references, can be flagged and matched against your reported income.
2. Third-Party Reporting
Platforms like:
- Uber, Airtasker
- PayPal, Stripe
- eBay, Upwork
are required to report your income directly to the ATO.
Even big companies you invoice might report your payment info through business records.
3. BAS & GST Registrations
If you’re GST-registered, you must lodge Business Activity Statements (BAS). The ATO compares BAS income with annual returns to catch mismatches or underreporting.
4. Digital Bookkeeping Tools
If you are using ATO-connected tools like Xero, MYOB, and QuickBooks, they automatically sync income, expenses, and invoices, which can be accessed during audits.
Cloud accounting creates a digital trail that the ATO can follow.
5. Taxable Payments Reporting System (TPRS)
If you work in cleaning, construction, courier, IT, or security, companies that pay you must submit annual payment reports directly to the ATO.
6. 2025–26 ATO Focus Areas (NEW)
For 2025, the ATO is watching:
- Ride-share and gig economy workers
- Work-related expense deductions
- Crypto traders and digital assets
- Rental property claims
7. Real-Time Reporting Is Coming
Through Single Touch Payroll (STP) and upcoming real-time ABN reporting, more data will flow live to the ATO, making hidden income easier to detect.
ATO is tightening its grip in 2025. Is your industry on the radar?
Explore the taxation service provided by the ISM Accountant’s expert and make your financial work easy.
Can You Get Away Without Declaring ABN Income?
No, you can’t get away without declaring ABN Income anymore.
If you thought small freelance jobs or Uber side hustles could “fly under the radar,” think again.
ATO’s Data Matching Program Is Stronger Than Ever
Example: A tradie under-reported his PayPal income. ATO caught the mismatch between deposits and his tax return. He faced:
- A full audit
- Back taxes
- 25% penalty for false declarations
Risk of “Sham Contracting” or Incorrect Use of ABN
If you work like an employee but are forced to use an ABN, it could trigger a sham contracting audit. This means incorrect worker classification affects taxes, putting both the worker and the business at risk.
ABN or TFN: Which Should Freelancers Use?
If you run a business, issue invoices, manage taxes and retirement fund contribution yourself (common for freelancers, contractors, sole traders), use ABN and if you are employed and receive wages with tax withheld by your employer, use TFN.
Not sure if you’re being misclassified as a contractor? We can help determine if your ABN is being used correctly and legally.
What Happens If You Don’t Report ABN Income?
Unfortunately, unreported income can lead to penalties, interest charges, and serious stress down the line.
The ATO’s system is very effective in finding income you haven’t reported, and the penalties become more serious the longer you wait. These can happen if you don’t report your income.
1. Audits and Reviews
Common triggers:
- Large deposits with no BAS
- No declared income from platforms that report to ATO
- Discrepancies between bank deposits and reported revenue
2. Penalties and Back Taxes
You could face:
- Up to a 75% penalty on undeclared income
- Interest charges
- Reputation risk if caught in an audit
Worried you’ve already under-reported income?
Our experienced tax team can help fix it before the ATO comes calling.
How to Stay Safe: Best Practices for ABN Holders
If you’re an ABN holder, you don’t have to worry about compliance. With a few smart habits, you can stay on the ATO’s good side while focusing on your business.
The practical strategies that keep most ABN holders out of trouble:
1. Track All Income Sources
Use digital tools to:
- Log every payment
- Store invoices
- Back up records with bank data
2. Separate Business and Personal Finances
Make a separate dedicated business account which makes it easier to:
- Prove income and expenses
- Reconcile records at tax time
3. Declare Everything, Even Small Jobs
Income below $75,000 still must be declared.
GST registration only affects if you charge GST not whether you report income.
Get guidance from ISM Accountant to avoid costly errors and missed income.
Tools and Resources for ABN Income Tracking
The right tools can automate most of your ABN income and keep you compliant without the hassle.
Here are the tools that actually make ABN income tracking manageable.
Free ATO Tools You Should Use
- ABN Lookup – Check ABN status
- ATO Tax Calculator – Estimate tax payable
- MyGov Account – Access Notice of Assessment, tax returns, and BAS
- ATO App – Track expenses and mileage
How to Check Your ABN Income Using MyGov: A Step-by-Step Guide
Your MyGov account is your direct line to see exactly what the ATO knows about your ABN income. Follow these steps to access and review your income records:
- Link or create a MyGov account – If you don’t already have one, setting up MyGov takes just a few minutes and gives you 24/7 access to your tax information.
- Navigate to ATO online services – Once logged in, connect to the ATO portal where all your business tax information lives.
- Access your Business Activity Statements and income summaries – Review your BAS history and income summaries to see what’s been reported to the ATO.
- Verify reported income against your records – Cross-check these figures with your own bookkeeping to spot any missing income or discrepancies that need addressing.
Need help using ATO tools or setting up myGov? Explore the best accounting service in Perth or any cities in Australia.
When ATO Typically Reviews ABN Income?
- Most audits happen after tax lodgement
- ATO typically reviews records within 1–2 years
Platform-reported data can trigger instant red flags
How ISM Accountant Can Help You Avoid ATO Trouble?
At ISM Accountant, we’ve helped countless ABN holders navigate compliance requirements and avoid ATO issues. We offer:
- Free ABN income health checks
- BAS preparation and lodgement
- Bookkeeping setup and support
- Tax return services
- Audit representation
Final Thoughts: Can ATO Track ABN Income?
The ATO has sophisticated systems to monitor your ABN income, even for side hustles or part-time freelancing. Ignoring your reporting obligations could lead to penalties, audits, or worse.
Still have questions about ABN income tracking or ATO audits? Contact ISM Accountant to get your answer.
FAQ: Can ATO Track ABN Income?
Yes, ATO can see your ABN income even if you’re not GST-registered. All income must be reported regardless of GST status. The ATO uses bank and platform data to verify.
Even a small income (under $75,000) must be declared in your annual return.
Yes, you can get in trouble for not declaring ABN income. You may face penalties, interest, and audits for non-compliance.
Yes, Paypal or platforms like Uber, Upwork sends your income data directly to the ATO.
You should use an ABN for freelance work. A TFN is for employment income only.
