Doing Assignment-business income/draw down

[Brownie001]

Up

0

::

Hello, hI have a question.
Is it better to maximise claims from a small partnership or the owners to draw down and then claim expenses against that. eg:
gross earnings $20000
Less expenses $5000
= $15000
Owners 60/40
Owner 1 9000
less deductions: work from home, ph & Internet, gifts etc 2000
= 7000.

or does owner 1 include work from home, ph & Internet, gifts etc as costs to the business.

gross earnings $20000
Less expenses $7000
= $13000

Any help would be appreciated.
Thanks, Mark

[Paul – FS Concierge]

Up

0

::

Hi And Welcome to Flying Solo [USER=119351]@Brownie001[/USER] . It is great to have you!

Thank you for joining our community and posting.

Hopefully some helpful members will be along soon with some advice to point you in the right direction.

Cheers

[Brownie001]

Up

0

::

“Thank you for joining our community and posting.
Hopefully some helpful members will be along soon with some advice to point you in the right direction.”

Thanks Paul,

Been looking around. Great site!

[Brownie001]

Up

0

::

Hi, any clues on this. This is due Friday.

Any help would be appreciated.

[LucasArthur]

Up

0

::

Brownie001, post: 271134, member: 119351 wrote:

Hi, any clues on this. This is due Friday.

Any help would be appreciated.

Ask your teacher?

Jason Ramage | Lucas Arthur Pty Ltd | E: [email protected]   P: 61 3 8324 0344    M: 61 412 244 888

[Brownie001]

Up

0

::

LucasArthur, post: 271145, member: 34537 wrote:

Ask your teacher?
Not so easy to get hold of them these days

[Paul – FS Concierge]

Up

0

::

Brownie001, post: 271111, member: 119351 wrote:

Hello, hI have a question.
Is it better to maximise claims from a small partnership or the owners to draw down and then claim expenses against that. eg:
gross earnings $20000
Less expenses $5000
= $15000
Owners 60/40
Owner 1 9000
less deductions: work from home, ph & Internet, gifts etc 2000
= 7000.

or does owner 1 include work from home, ph & Internet, gifts etc as costs to the business.

gross earnings $20000
Less expenses $7000
= $13000

Any help would be appreciated.
Thanks, Mark
The simple answer from a NON-Accountant is to calculate Gross Profit.

Then deduct all deductible expenses eg, working from home would only be partially deductible in most cases.

The ATO website has answers around what a business expense is.

How to pay yourself can have major tax implications and can get complicated quickly so I will not attempt to give advise.

When dealing in any form of accounting, it is important to become familiar with Accounting terms commonly used and not mix them up with with common language eg, you don’t make a “claim”. You DO deduct business expenses as part of arriving at Nett Profit.

Good luck.
Paul

[Brownie001]

Up

0

::

Thanks Paul,

Regards,
Mark

[Author]

Posts