Claiming business expenses at tax time


Claiming business expenses at tax time

Flor- Hanly - Monday, June 10, 2019

Reducing errors when claiming business expenses

The ATO has identified some common tax return errors when it comes to claiming business expenses.

business expense claimsNamely:

  • If you use a motor vehicle entirely for your business, you can claim a deduction for the whole amount. If you use it for a mix of business and private use you will need to apportion the expense and only claim the business portion.
  • You must keep your business expenses separate from your private expenses such as private rent, fines, travel, food and renovations of a private residence.
  • If you are upgrading accounting software, it is important to check that business and private expense codes are correct.
  • Your business expenses must be claimed at the GST exclusive rate if you are registered for GST, not the GST inclusive rate.
  • If you operate your small business as a company or trust, paying private expenses from these accounts may have other tax implications such as fringe benefits tax and shareholder loans.

Flor-Hanly Accountants in Mackay can help you get it right by advising you on what you need to satisfy the following three golden rules:

  • the expense must have been for your business, not for private use
  • if the expense is for a mix of business and private use, you can only claim the portion that is used for your business
  • you must have records to prove it.

Flor-Hanly operates throughout Mackay, Clermont and Central Queensland. Our accounting team works with you to help you determine, focus on and achieve your personal and business goals. Call us on 07 4963 4800.

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