Declare side hustle: FRCS

Salary and wage earners who make extra money outside their regular jobs are reminded that any additional income must be declared for tax purposes.

This includes earnings from rental properties, Airbnb and homestays, online businesses, taxi and minibus operations, farming and fishing.

The Fiji Revenue and Customs Service (FRCS) issued the reminder in a public notice yesterday, urging individuals earning additional income to keep proper records of sales, invoices, bank statements and receipts.

Those operating unregistered businesses must register through the Taxpayer Online Service Portal, with tax returns due by March 31.

Economist and former minister Dr Mahendra Reddy said the requirement was justified in principle, but the bigger concern was whether the tax system was fair, practical and easy to comply with.

He said people earning similar incomes should pay similar amounts of tax, arguing that undeclared earnings gave some operators an unfair advantage over registered shops, accommodation providers and consultants.

Dr Reddy said collecting taxes already due could also ease pressure on the Government to increase tax rates.

He stressed that declaring income did not mean every dollar received was taxable profit. Business expenses, including seeds, fuel and materials, must be accounted for when calculating taxable income.

He warned that excessive paperwork and complicated compliance requirements could discourage people from taking on additional work or formalising small businesses.

Enforcement, he said, should focus on deliberate tax evasion rather than burdening small operators who were trying to comply.

Dr Reddy also said the FRCS notice did not clearly explain the difference between declaring income, calculating profit and determining the tax payable. This could leave people thinking they were being taxed on every dollar received.

Fiji Commerce and Employers Federation chief executive officer Edward Bernard supported the FRCS reminder, saying additional income should be encouraged because wages alone might not be enough to meet a family's needs.

He said only 10 per cent of the workforce paid income tax, which helped fund essential services and infrastructure.

However, an online business owner, who asked not to be named, questioned the impact of additional tax obligations on small operators.

"If we pay another tax, we don't really have a lot left," the owner said. A money lender said taxing all income was "part of the law".

Earlier this year, FRCS chief executive officer Udit Singh said unrecorded cash transactions, commonly referred to as the black economy, were estimated to be worth between $800 million and $1 billion.

Individuals have a $30,000 threshold. "Everyone is allowed to earn a living, provided they pay some tax."