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  • #966564
    Howieau
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    Hey,

    I plan to start my own business soon but wish to gather some experience in the field first. The business will be working on cars electrical systems so I wish to buy some equipment and practice some skills before I establish my business. I currently have an ABN and use it for a seperate sole trader business.

    In order to claim deductions on the electrical equipment I purchase for the new business, must I already have a seperate business name registered and purchase it under that? Or can I simply just buy the equipment normally and then when I have established myself officially as a business in car electrics later on, use the receipts then to claim deductions? The equipment will only be used for business purposes.

    Many thanks.

    #1019426
    FletcherTax
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    Hi Howie

    Firstly, you can only claim expenses for a particular stream once you have income from that particular stream. Hence, keep all your receipts and they will be treated as deferred losses until you have income from car electronic systems.

    On a side note, is your current ABN business completely different to the car electronic systems you wish to start up? The ATO has special rules for similar type businesses.

    Best wishes for your venture and feel to contact us if we can help further,

    Fletcher Tax Accountants
    http://www.fletchertaxaccountants.com.au

    Please note comments made should NOT be taken as specific taxation, financial, legal or investment advice. Please seek professional, specific advice.

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