Accountant Aged Care Allied Health Andrew Bragg Annuity Apps Asic Asset Finance Asset Planning Asset Protection Asset Protection Strategies Assets Assets and Risks Ato Auction Audit Insurance Australian House Market Report Baby Bonus Bas Binding Death Benefit Nominations Binding Financial Agreement Binding Financial Agreements Body Corporate Bonds Borrowing Brexit Budget Budgeting Business Business Registrations Business Support Business Tax Deduction Business Value Capital Gains Tax Capital Gains Tax: Will Capital Protection Catherine Frost Cgt Checklists Commercial Loans Commercial Property Company Tax Concessional Superannuation Contribution Corporate Trustee Cryptocurrency Darren Foster Debt Debtors Deceased Estate Depreciation Dereen Wallace Director Director Id Divorce Economic Update Economy Emily Kermac Employees Estate Planning Executor Fbt Federal Budget Federal Election Finance Finances Financial Advice Financial Plan Financial Update Franking Credits Government Grants Gst Holiday House Home Office Hybrid Unit Trust Individual Ownership Insolvency Insurance Insurance In Super Interest Rates Investment Investment Loan Investment Loans Investment Property Investments Janet Kohan Jobkeeper Jobmaker Joint Ownership Ken Burk Land Tax Lending Life Insurance Linda Hamilton Loan Repayments Loans Lvr Margin Loans Margin Scheme Market Update Medical Expenses Mortgage Mortgage Broker Mortgage Broking Mygov Negative Gearing Offset Account Overseas Gifts Parental Leave Paris Financial Pat Mannix Payg Payg Variation Pension Practice Valuations Private Wealth Property Property Development Rebecca Mackie Record Keeping Redraw Facility Refinance Renovating Research & Development Retirement Retirement Planning Retirement Savings Salary Sacrifice Scams Self Managed Superannuation Self Managed Superannuation Fund Seminar Shares Small Business Smsf Smsf Borrowing Smsf Property Smsf Self Managed Superannuation Fund Steve Golding Steve Wildes Strategic Business Structuring Structures Subdividing Property Succession Plan Superannuation Superannuation Fund Tanya Hofbauer Tax Tax Benefits for Super Tax Concession Tax Deduction Tax Investment Property Tax Losses Tax Offset Tax Planning Tax Savings Tax-Free Temporary Full Expensing Tenants in Common Tessa Testamentary Trusts Tfe Training Transition to Retirement Trust Trusts Ttr Will Working from Home

Business income and expenses

 Business income and expenses

If you’re running a business, most income you receive is assessable for income tax purposes. The total amount is referred to as ‘assessable income’.

You need to report assessable income in your tax return. It includes:

  • cash income and income from online transactions
  • commissions and investment earnings
  • recovered bad debts for which you’ve previously claimed a tax deduction
  • most government payments
  • capital gains and losses
  • increases in the value of your trading stock
  • stock taken for personal use
  • payments from an insurance claim related to your business.

Make sure to also check what income you can exclude – for example, some COVID-19 government payments aren’t assessable if you meet the eligibility criteria.

Remember you can reduce your business’s taxable income by claiming business tax deductions, as long as:

  • the expense directly relates to earning your business’s assessable income
  • you only claim the business-use portion if the expense is for a mix of business and private use
  • you have records to substantiate your claims.

Expenses may include:

  • motor vehicle and travel expenses
  • items related to protecting staff from COVID-19
  • employee super contributions
  • payments you make to workers (including their wages) as long as you’ve complied with the pay as you go withholding and reporting obligations for each payment.

If you haven’t already, check out the ATO’s small business tax time toolkit for more links to information and fact sheets.

Remember, registered tax agents like the team at Paris Financial can help you with your tax! Feel free to contact our office to discuss further: (03) 8393 1000.

 

Source: ATO Newsroom