What about Expenses?

While the ATO does not keep a complete list of what you can claim as a business expense, they do have two basic guidelines. Firstly, you must have actually paid or at least are committed to spending money on the expense and secondly, the expense must be shown to be related to your business. You cannot claim any private or domestic expenses including food or regular clothing or similarly, expenses incurred prior to commencing the operation of your business.

Common claims include, although are not limited to, advertising, bank fees and charges, business travel, electricity, wages, vehicle expenses, repairs, phone expenses, rent or lease costs (including home premises), home office expenses, freight/transport fees and super contributions. If you are unsure about what you can claim as a business expense, contact either the ATO or your tax advisor.

Claiming deductions for depreciation is also a legitimate part of business reporting. A depreciating asset (an asset that has a limited effective life) includes your computer, any business tools, furnishings, carpet, curtains and motor vehicles.

For further information visit www.ato.gov.au or download their guide entitled Tax Basics For Small Businesses (http://www.ato.gov.au/content/downloads/BUS25193n1908_07_10.pdf), which is particularly helpful when determining your expenses.

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