Home Forums Starting your journey Tax claims for payments incurred from outsourcing work on sites such as odesk and elance

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    Im relatively new here and have a question on claiming tax for outsourced work on websites such as elance and odesk.

    I’m a sole trader and paid a few website developers from india on elnace.com to help me build a few websites to get them up faster. The payments made are logged on the site but I don’t have an invoice for it. This is thousands of dollars spent and i consider it an expense incurred and feel i can claim it on tax. I have a few questions about this process.

    1. Is it possible to claim this work on tax and if so can it all be claimed? (noting I am a sole trader and this came out of my pocket from money i made from my day job with the intent to make an income)
    2. What do i do about the invoice? Can i make the invoice myself from the details of the payment logged on the site? (they sent one in email but it didn’t have my TFN or ABN on it)
    3. What would i class the claim as? would it come under incurred expenses?

    Thankyou very much for the help. Just wrapping my head around things

    • Total posts: 20

    Your accountant can advise the finer details, how much of it you can offset this financial year, any special rules for that kind of work etc, but an expense is an expense.

    Don’t make up an invoice. You don’t send actual invoices to the ATO anyway, just the figures. Make sure you keep documentary proof of the cost – I ‘d keep a copy of the bank statement showing the final actual AUD figure after transaction fees etc, plus details of the PayPal transaction, any relevant emails etc in case I found myself having to justify things one day. But then I’d just file all that stuff with all my other invoices and give my accountant the figures.

    • Total posts: 873

    Freelancer issues you invoices ; it just issues them from itself
    Go to Finances > Transaction History
    You should see something like this:

    27 Aug 2015 13:13PayPal payment from {account} ( at 23:13:43 Aug 26, 2015 EDT) (AUD)AUD33.51
    with a little PDF icon

    1. Yes, you can claim it, definitely. You’ll probably find all of it can be claimed, but confirm with your accountant or book keeper.
    2. See above for the receipt
    3. How you claim it depends on what it is – however, most of mine get booked as “Expense – Subcontractor” or similar. If I’m getting them to do work for me for a client, then it goes “CGS – Subcontractor”

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