FAQ Group: Sydeney LETS FAQs

When you use LETS, you are participating in an internal market, which is subtly different from the national or regional markets, which use conventional money. Everyone is still keen to get as much cash as possible. But the ability to earn LETS money is enhanced and there is pressure to spend it rather than hoard it. These factors can combine to give a much lower spread between low price and high price services. People who overcharge find that their trading slows up dramatically and their ability to earn is reduced.

LETS is an ethically based trading systems in that they are community based and controlled and no person can profit from the LETS itself, though anyone can benefit from any trading they do in the system. Local currency is also ethically driven in that its worth is derived from a member’s commitment to return the value of goods and services received to other members of the LETS. If a person attempts to “rip off” a LETS group, other account holders can simply refuse to trade with them. To ensure this, each member is allowed to know the balance and turnover of any other member, but no other trading information. LETSystems are cost-of-service, not-for-profit systems run and operated by the members. No person or organisation outside the system can profit or benefit from the system, either in dollars or local currency.

The potential exists for an individual to take and not return. However, even if this does take place, the people who have received payment will be able to trade unimpaired. This has no effect on the structural integrity of SydneyLETS. If too many people do this the others will simply slow their trading down, as their ability to spend will be reduced.

Not unless you want to take some. Participation does not make you liable for the affairs of the other members or for the SydneyLETS itself. Treat LETS work as if you were obtaining a quote from a trades-person from the Yellow Pages. If it is a major household project, ask for a written quote for work, prior to the work being done. As with all business dealings, it is advisable to negotiate an exchange of operas prior to the trade taking place. Members are advised to take out Work Care cover (approx $10.00 per year), as household liability insurance may not cover household workers employed on your property.

If you are concerned about LETS trading causing problems with a Centrelink payment please discuss with your Centrelink officer. If they have any questions we are happy to talk to them to explain that no federal currency is involved and that LETS is a great way to stay active in the community.There is a clause that allows income from government approved LETS based job training trading systems to be exempt. Sydney LETS doesn’t have an official exemption.

NOTE: This info may be outdated – please ask your tax professional to check the ruling for Community Barter Systems Accountability for taxes incurred by members is the obligation of those involved in an exchange.  The official ruling states that if you earn local units whilst providing a service which is your main profession you must pay tax on all profits OVER 300 units as if you had earned dollars. Units are also deductible so if you spend operas on your business expenses you may declare it. For example: if your main profession is a plumber and you do some plumbing work to the value of 700 operas then 400 operas is considered taxable at the normal rate. If however you spend those 400 operas on bookkeeping or other business expenses then the profit you have made in that year is only 300 operas and the tax department don’t want to know about it. Also if you earn operas as a handy-person (ie put up a chook shed) then this is not considered as earnings under your main profession (plumber) and is exempt from income tax.

There is no control, or monitoring by SydneyLETS, of either the rates people charge or of the quality of work performed. However normal consumer affairs and small claims tribunal rules do apply and if there is conventional protection for services performed (eg. Law Society, Master Builders Assoc. etc.), these also apply with local currency trading. SydneyLETS provides no warranty or undertaking as to value, condition or quality of the items exchanged is expressed or implied for claims for injury or damages of any nature arising from trade between members.

See the Join page for details.

If you are going to be out of the area for a period of time, and do not wish to receive newsletters or registers, please notify the office in writing before you leave. If your membership has lapsed you may renew it at any time within two years and retain your original balance.

You should try to bring your account as close as possible to zero. If you intend to move from the area permanently, please advise the office before the move.