What you need to know about deductions
When working out what business deductions to claim this tax time, it's important to remember the three golden rules:
1. The money must have been spent for your business – not a private expense. Most business expenses are deductible but you can't claim a deduction for private expenses, such as child care fees and clothes for your family.
2. If it's a mix of business and private use, only claim the portion related to your business.
For example, if you bought a computer for your business and your kids use it to do their homework, that's a private use. You will need to work out how much of the computer use was for your business and only claim a deduction on that portion of the computer's cost.
3. You must have a record to prove your expense
Before you can claim a business deduction for an expense, you must:
have a paper or electronic record of the expense, for example, bank statements or receipts be able to demonstrate how you calculated your claim – including working out the business portion of the expense.
Remember, AGC Advisory can always help you with your tax (no matter how complicated it may get). At AGC we are Chartered Accountants with over two decades of experience.
The consultants at AGC Advisory are adeptly trained in all areas of business and finance. Their sound knowledge and years of industry experience are what makes AGC Advisory highly regarded as a genuine resource amongst its clients.
Article: Adapted from ATO Small Business Newsroom