A Simple Guide to Tax Deductions for Australian Businesses

What is the BAS Report? Why do you need it?

The Business Activity Statement, or BAS, is a business’s quarterly tax reporting form submitted to the Australian Taxation Office (ATO). On the BAS, businesses report their total GST collected on sales and GST paid on expenses over the last three months. This allows the ATO to determine if a business owes additional tax or is due a refund.

if your business is registered for GST, you must submit BAS reports.

The BAS is a separate reporting requirement from your tax return. As a GST-registered business, you must report your GST activity and amounts on a BAS on a quarterly basis, regardless of whether you meet the lodgment threshold for income tax returns. It discloses your total GST collected from sales as well as GST paid on business expenses over the reporting period. The Australian Taxation Office uses this information to determine if you have a GST refund owing or additional GST amount payable.

Submitting your BAS ensures you are meeting your GST obligations as a registered business and helps maintain your GST registration status. Even if no sales or expenses were recorded in a particular quarter, a BAS must still be lodged to report nil activity.

What is TFN?

A tax file number (TFN) is your personal reference number in the tax and superannuation systems.

Your TFN is:

a unique number (usually 9 digits)
an important part of your identity
yours for life – you keep your TFN even if you change jobs or name, move interstate or go overseas.

Please send enquiry if you need to apply TFN.

How to find your bank statement

To find your bank statement from online banking, you can follow these general steps:

Log in to your online banking account using your username and password. This information is typically provided to you when you set up your online banking account.
Once logged in, navigate to the section or tab that contains your account information or transactions. This may be labeled as “Accounts,” “Transactions,” or something similar.
Select your business account for which you want to access the bank statement. If you have multiple business accounts, please download all those accounts’ statements one by one with the following steps.
Look for an option or link that allows you to view or download your bank statements. It may be labeled as “Statements,” “Documents,” or “Statements and Documents.”
Choose the statement period or date range for a financial year. For example, if you are doing a tax return of the financial year 2023, please choose 1 July 2022 to 30 June 2023.
Click on the statement or download button to access the bank statement. Depending on your bank’s online banking platform, the statement may open in a new window or be downloaded as a PDF or other file format.
After finishing downloading, please update your file to our online tax return system.

If you are unable to locate your bank statement, please contact your bank staffs.

How to get bank transaction records

To get bank transaction records from online banking, follow these general steps:

Visit your bank’s website and enter your login credentials.
Once you’re logged in, look for a section or tab labeled “Account Activity,” “Transactions,” or something similar. The exact wording may vary depending on your bank’s online banking platform.
Select your business account for which you want to access the bank statement. If you have multiple business accounts, please download all those accounts’ statements one by one with the following steps.
Choose the transaction period or date range for a financial year. For example, if you are doing a tax return of the financial year 2023, please choose 1 July 2022 to 30 June 2023.
After selecting the date range, click on a button like “Export,” “Generate,” “Search,” or “Get Transactions” to export data.
Once the transaction history is generated, it will automatically download to your device. Please open it and double-check that they include the desired transactions and that the information is accurate. If everything is setting down, please upload all transactions CSV files to our online tax return system.

It’s important to note that the specific steps may vary depending on your bank and its online banking platform. If you encounter any difficulties or have specific questions, it’s best to reach out to your bank’s customer support for assistance.

How Would I Know If I Have Activated GST?

To check if you have registered GST, please go to ABN Lookup(https://abr.business.gov.au/):

Type your ABN number is search box and click search button.
Find your ABN record in search result.
Check the status of “Goods & Services Tax (GST)”.

What is Medicare Levy Exemption？

Medicare is Australia’s universal healthcare system that provides affordable medical care for all residents and citizens. While Medicare is funded through a 2% Medicare Levy paid by individual taxpayers, there are certain exemption criteria that allow some people to claim a Medicare Levy Exemption. To understand if have met the requirements of Medicare Levy Exemption, please check the article below:

What is the Medicare levy Exemption

Am I eligible to claim a deduction for working from home expenses?

To be eligible to claim a deduction for working from home expense, you must:

Incur additional running expenses as a result of working from home
Be working from home to fulfill your employment duties, not just completing minimal tasks
Keep records at the time you work to prove you incur the cost

For more information, please check here.

Why student visa holders cannot claim this self-education expense

For oversea students, if you are holding a student visa, your primary intention for obtaining the visa was to study in Australia before gaining working rights. Prior to enrolling and incurring tuition expenses, you were not permitted to work or be employed in Australia. However, when it comes to claiming self-education expenses, the requirement is that the course should be directly related to improving the skills required for your current income-earning activities. Therefore, as a general rule, international students are usually unable to claim self-education expenses.

For information, please check:

WHY OVERSEAS STUDENTS CAN’T CLAIM SELF-EDUCATION DEDUCTION IN TAX RETURN?

What's the difference between business-related expenses and PAYG expense?

In the context of Australian tax returns, there are two types of work-related expenses: business-related expenses and PAYG (Pay As You Go) work-related expenses. Here’s an overview of the differences between them:

Business-Related Expenses (ABN): These expenses are incurred by individuals who operate their own business or work as independent contractors. In this section, you can claim deductions for expenses directly related to your business activities, such as office rent, equipment costs, advertising expenses, professional fees, and other costs directly incurred in running your business.

PAYG Work-Related Expenses: These expenses are incurred by individuals who are employees and receive a salary or wages subject to the PAYG withholding system. PAYG work-related expenses are typically associated with the performance of your job and are directly related to earning your income. For example, expenses for uniforms, training courses, and work-related travel.

It’s important to note that there are specific criteria and substantiation requirements for claiming both types of work-related expenses. Generally, you can only claim deductions for expenses that are directly related to your work and are not reimbursed by your employer.

What Happens If I Don't Have an Invoice?

Under Australian Tax Law, deductions totaling more than $300 must be substantiated with proof such as a receipt or other relevant document. If you cannot provide such evidence, we regret that we will be unable to process your deduction.

What is Medicare Levy?

The Medicare levy is an amount you pay in addition to the tax. if you meet certain conditions, you could claim a Medicare levy exemption from your taxable income.

More information about Medicare levy exemption:
What is the Medicare levy Exemption

To be legible for an exemption, ATO may ask you to provide a Medicare levy exemption certificate. In this case, you must get a Medicare Entitlement Statement(MES) from www.servicesaustralia.gov.au.

Why need the information of my family?

Because you may get a reduction or exemption from paying the Medicare levy surcharge, depending on you and your spouse’s income and circumstances.

For more information, please check: How family and dependents affect on Medicare Levy Surcharge

Before You Start, You Must Agree

Tax returns require truthful and legally obtained documentation. Please double check all information you upload matches your actual financial records.
The ATO conducts compliance checks, so false claims may result in penalties if discrepancies are found later on. We’re here to help you maximize deductions, but cannot condone fabricated receipts or expenses.
Income statements like pay slips or supplier invoices must be the copy of original documents, not altered versions.
Personal details like your name, address and birthdate should be entered exactly as shown on official identification like a drivers license or passport.
Be sure to include all required income, including cash earnings or side jobs. Leaving things out risks an audit down the road for underreporting.
Ask us if you have any unclear situations or documentation issues before submitting. We’d love to help make sure your return is fully accurate to avoid issues with the ATO.

What Is Capital Gains Tax?

Capital gains tax (CGT) is the tax you pay on profits from disposing of assets including investments, such as property, shares and crypto assets. Although it is referred to as ‘capital gains tax’, it’s part of your income tax. It’s not a separate tax.

ABN

ABN stands for Australian Business Number. It is a unique 11-digit number that is issued by the Australian Business Register (ABR) to businesses and other entities, such as sole traders, partnerships, companies, and trusts, that are carrying on an enterprise in Australia. The ABN is used as a universal identifier for businesses and is required for various purposes, including:

Registering for Goods and Services Tax (GST) and Fringe Benefits Tax (FBT) with the Australian Taxation Office (ATO).

Claiming tax credits and deductions, such as input tax credits for GST.

Dealing with other government agencies, such as the Australian Securities and Investments Commission (ASIC) and the Australian Business Licence and Information Service (ABLIS).

Conducting business with other entities, such as suppliers and customers, who may require an ABN for invoicing and payment purposes.

To apply for an ABN, businesses and other entities must meet certain eligibility criteria, such as being registered for GST or operating in a business-like manner. Once an ABN is issued, it does not expire and can be used for the life of the business or entity, provided that the information held by the ABR is kept up-to-date.

If you have an ABN, but you forget it, please check: HOW CAN I FIND MY ABN?

Which method should I choose?

Method One: Revised fixed rate method

The revised fixed rate method allows you to claim 67 cents per hour you work from home for the expenses listed below. You no longer require a dedicated home office to use this method:

Expense included in the revised fixed rate are:

data and internet
mobile and home phone usage
electricity and gas
computer consumables (e.g. printer ink)
stationery

You can’t claim a separate deduction for any of the expenses the revised fixed rate includes.
You can claim a separate deduction for:

the decline in value of assets used while working from home, such as computers and office furniture
the repairs and maintenance of these assets
cleaning (only if you have a dedicated home office)

Method Two: Actual cost method

The actual cost method allows you to claim a deduction for the actual expenses you incur as a result of working from home.
You may be able to claim a deduction for each of the expenses you incur, such as:

data and internet
mobile and home phone usage
electricity and gas
computer consumables (e.g. printer ink)
stationery
the decline in value of assets used while working from home, such as computers and office furniture, as well as any maintenance and repairs of these items
cleaning (only if you have a dedicated home office)

The actual cost method requires detailed calculations and records. For example, you will need to know and have records of the cost per unit of electricity and average units used per hour.

For more information, please check here.

Is it safe to give tax agency your crypto API and secret key?

In order to better understand this question, it’s important to understand the various types of access that certain cryptocurrency exchange API’s grant. You can configure what type of access you want your API key to grant using your exchanges account settings. Read only access allows the system that is connecting to the exchange API to only “read” or “view” the transaction data for that user account.

This type of granted access is popular amongst portfolio trackers and tax software systems that only need to know your transaction history in order to work properly. These applications, such as us, do not need to be able to make trades on your behalf, we only require this “read only” access to get your income data for tax return purpose. Programs with this type of access CANNOT make trades or withdraw funds on your behalf, so it is safe for you.

How can I get my Uber report?

To obtain your Uber report, you can follow these steps:

Visit the Uber website: Go to the official Uber website at www.uber.com and sign in to your account using your Uber credentials.
Access your account settings: Once logged in, locate and click on your profile icon or photo in the top-right corner of the screen. This will open a drop-down menu.
Open the Privacy settings: In the drop-down menu, find and select the “Privacy” option. This will take you to the Privacy settings page.
Request your data: On the Privacy settings page, scroll down until you reach the “Access and manage your data” section. Look for a link or button that says something like “Download your data” or “Request your data.” Click on it to initiate the data request process.
Specify the data you want: The Uber platform may provide options for you to select the specific types of data you want to include in your report. This can include trip history, account information, payment details, and more. Review the available options and make your selections.
Submit your request: After making your selections, submit your request to Uber. The platform may require you to re-enter your password or go through an additional verification step to ensure the security of your data.
Wait for the report: Once you’ve submitted your request, Uber will process it and generate your report. The time it takes to receive the report can vary, but you should typically receive an email notification from Uber when your report is ready for download.
Download the report: When you receive the notification, follow the instructions provided to download your Uber report. The report is usually provided in a downloadable format, such as a ZIP file or PDF document.

If you encounter any difficulties or have specific questions about obtaining your Uber report, it’s recommended to reach out to Uber’s customer support for further assistance.

When Should I Amend My Tax Return?

To amend your tax return, to fix a mistake or include additional information you can lodge a request online, by paper, through your tax agent or by sending us a letter.

Individuals and sole traders can request an amendment to their income tax return if

they have made a mistake
forgotten to include something
had a change in circumstance after lodging.

Who Is Sole Trader

A sole trader is an individual running a business. If you run your business as a sole trader, you are:

the sole owner and controller of it
legally responsible for all aspects of the business, including debts and losses you incur in running it.

Please send enquiry if you need to apply ABN.

I'm a Uber/Didi Driver, What Should I Do?

Fares paid to taxi drivers by passengers include goods and services tax(GST). If you’re a taxi driver and you’re not employed by someone else, you must:

register for GST – regardless of how much you earn
only claim GST credits related to your work
lodge business activity statements (BAS) monthly or quarterly (you can’t choose to lodge annually)
pay your net GST

Also, lodge a tax return regardless of how much you earn from ride-sourcing because you are operating a business. If you have registered ABN and GST, please choose “GST Activated”. If you don’t have, please contact us to register them.

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