Hobby vs Business
A hobby is an activity you enjoy in your free time—whether for relaxation, skill-building, or pure enjoyment. However, what starts as a passion project can evolve into a business as you grow.
Hobbies That Can Become Businesses
Many hobbies have the potential to generate income, such as:
- Creative pursuits – photography, painting, or jewellery-making
- Gardening & DIY – landscaping, home repairs, or handyman services
- Tech & digital skills – website design, blogging, or social media influencing
How to Tell If You're Running a Business
The distinction between a hobby and a business isn’t based on how much money you make but rather on your intentions and how you operate.
Your activity is likely still a hobby if you:
- Sell or gift your work but only aim to recover material costs, not make a profit
- Do not need to report income from your hobby to the Australian Taxation Office (ATO)
You're running a business if you:
- Intend to make a profit from your activities
- Operate in a structured, business-like manner
- Have registered a business name or obtained an Australian Business Number (ABN)
The Benefits of Turning Your Hobby into a Business
If your hobby has grown into a business, you can enjoy several advantages, including:
✅ Applying for an ABN
✅ Registering a .com.au domain name for a professional online presence
✅ Claiming tax deductions on business expenses
✅ Accessing government support and services for businesses
If your activities meet the criteria of a business, it may be time to take the next step and set up your business officially.
Thank you for reading!
Should you have any queries in regards to the above please contact our office on (03) 9728 1448
The TAS Team
3/653 Mountain Highway, Bayswater VIC 3153
Isabella Farmakis Buckovsky
Client & Practice Manager
Isabella liaises with clients and business owners to create rewarding decisions and develops long-lasting relationships by providing a relaxed and comfortable approach to tax and business queries
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