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umair862
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JacquiPryor, post: 87537 wrote:
Further (and if John is still checking this thread may be able to confirm this is correct) – If you are purchasing from overseas (or from Australia for that matter) for the purposes of completing work for a client then this might be a ‘cost of sale’ rather than straight business expense. I don’t think this will effect the tax question/answer but if you are tracking your outgoings in software etc these might be a cost to you of doing the sale, rather than an expense of running your business.

Thanks John and JacquiPryor for your replies:

@JacquiPryor

Now I am bit confused. I will explain a bit more.
I provide web development services to clients in Australia and I run my business in Australia. However, I use American or Indian websites (which is another business entity overseas) to outsource my work. They pay the contractors (I am not paying the contractors directly, I pay to the websites).
I don’t earn more than $75,000 so GST does not apply to me.
Can I claim the money paid to websites as business expense?

Example:

Australian Client pays me $1000 for a website.
I pay $200 to an outsourcing website like elance.com
Can I claim $200 as an expense?

Regards,
Umair