Tax deductions
Deductions for costs incurred in running your business are allowable, provided the expenses are not of a private, domestic or capital nature.
You may be able to claim deductions for your business expenses, when you lodge your income tax return, if your business:
- has motor vehicle expenses
- uses diesel fuel
- is based at your home
- has travel expenses
- uses plant, such as machinery, tools or computers.
If you are a contractor or a consultant then your personal services income can affect your tax obligations.
Entrepreneurs' Tax Offset (ETO)
If you are a small business entity and have an aggregated turnover of $50 000 or less, then you will be eligible for an ETO of 25% of the tax payable on your business income. The offset phases out when your aggregated turnover is greater than $50 000 and ceases once your turnover reaches $75 000.
What to do...
- Read the Tax Office information about personal services income essentials.
- Read about business deduction essentials.
- Download the Fuel tax credit guide for businesses from the Australian Taxation Office.
- Find out about home-based work and deductions.
- Read more information about the Entrepreneurs' tax offset on the Tax Office website or contact the Tax Office on 13 28 66.
This content is supplied to Flying Solo via business.gov.au,
the Australian Government's principal website for business information and resources.
