Camplify, tax and investing in a van

The easy answer is whoever owns the RV. If you own the RV in your personal name, then you will include the income and expenses in your personal return. If you own the RV in joint names, you will split the income and expenses between each of you. If your RV has been purchased in a Trust or a Company then the Trust and or Company reports the income and expenses.

The income and expenses you earn need to be reported in your tax return. The ATO are aware that the sharing economy is an evolving space and will be making changes to the tax return forms in the future to allow for greater flexibility. For now, they have advised that you should report the income at the “other income” label of the tax return and the expenses at the “other deductions” label.

Great news! We’ve had the ATO give specific advice for owners who hire on the Camplify website, and you don’t need to worry about having an ABN if your RV is available to you for private use. The only time you need to apply for an ABN is if you are carrying on a business of hiring out RVs. • If your intention of purchasing then renting an RV is to purely make a profit, • If you have multiple RVs, • Have a business name setup, or • You are managing RVs for others then you will certainly be carrying on a business and will need to have an ABN. If you are carrying on a business you will need to register for GST if your turnover is more than $75k in a year. The income you earn via Camplify needs to be added to any other income you earn with other business activities to determine if you are over the $75k threshold.

If you are using your RV personally a few weeks of the year, you need to ensure you are splitting your costs between personal and tax deductable use. The ATO have provided a worked example of how you would apportion the expenses. If you have a caravan listed on Camplify for 42 weeks of the year but also use the caravan yourself for 8 weeks of the year, then your Camplify use will be 80%. That means you can claim 80% of your depreciation, interest, insurance, repairs, etc, and 100% of your costs that are only related to hiring your RV.

The good news is, even though you have to pay tax on the income you earn from hiring out your RV, you also get to claim tax deductions on the expenses that are associated with your RV as well. Everything you pay for the RV becomes a tax deduction. Here is a list of the expenses we’d expect you to have: • Depreciation on the RV: this is a deduction for a portion of the purchase costs each year based on the expected lifetime of the RV. The ATO’s guidance on the lifetime for a caravan is 12 years. • Interest on RV finance • Repairs & maintenance • Insurance • Hospitality & consumables • Cleaning • Management fees • Storage • Transport (motor vehicle expenses) • Advertising • Software • Mobile phone • Internet • Home office expenses Some of your expenses will relate directly to hiring it out. For example, cleaning, vehicle expenses in transporting the RV, and Premium Membership fees. You can claim 100% of these costs as tax deductions. Other expenses relate to the ownership of the RV and should be apportioned between personal use vs Camplify use. This would be for things like insurance, registration, storage, and depreciation.

That depends on a lot of things; who owns the RV, how much other income you earn, and whether your costs are more than your income. If your costs are more than your income, then you won’t pay any tax at all. If your income is more than your costs, then you will pay tax on the difference. For those who own the RV personally, if you have no other income and have only earned $10k from Camplify, then you won’t pay any tax at all. If you have $50k of salary income and earn $10k after expenses from Camplify, then you will pay $3,450 tax (based on 17-18 tax rates & assuming you have no HELP debts). The tax part really depends on your personal circumstances, so it’s important if you are unsure to get some advice in this area.

The best way to maximise your tax deductions and minimise tax is to keep good records. That means keeping the receipts for everything you spend for the RV, purchase documents, registration, insurance etc. Use whatever system works best for you, whether it’s software or a spreadsheet to add up the costs at the end of the year. For your income, there’s no need to keep records. Instead, you’ll be able to download reports showing your income from your Camplify account. We always suggest simply setting up another bank account for your RV and ensuring all income from Camplify goes into this account, as well as all expenses are paid from this account. That’s the easiest way to keep track of everything in the 1 spot.

The short answer is yes, if your income is higher than your expenses. Centrelink are tracking all income you earn, including from the sharing economy. Whether your Camplify income has a negative impact on your pension will depend on your other income, your assets and the level of income you earn from Camplify. Remember your tax return shows the NET amount you earn, i.e. after deductions of insurance, registration, interest, etc. There are many factors to think about here, including the fact that you may make more money from hiring your RV on Camplify!

All of the information in this document is general. Please consult a professional financial advisor to discuss your personal situation. These FAQs have been put together by Growthwise for Camplify Owners.