To keep a healthy bottom line, businesses need to be smarter and sharper every financial year. It’s a good time to discuss ATO tax deductions – especially those deductions often missed.

Here are 5 tips on how to break out of those habits!

1. Repay Expenses: With tax deductions, every little bit counts. Prepaying your expenses can attract a tax deduction that is commonly overlooked. You can prepay expenses such as:
   1. subscriptions
   2. business travel expenses
   3. training events
   4. leases, rent
   5. phone
   6. Internet
   7. insurance
   8. business asset repairs, not exceeding more than one year.
2. Review your stock and inventory: conduct a stocktake for damaged and write-off stock. This is important because it will impact the value of the trading stock and your profit margins. You will also need to consider how to value your stock trading every financial year, as you may be entitled to a tax deduction when the opening stock exceeds the closing stock.
3. Rental Property expenses: Rental property expenses often go unclaimed. The most forgotten deductions are:
   1. bank fees
   2. gardening and lawn mowing
   3. pest control
   4. security patrol fees
   5. secretarial and bookkeeping fees
   6. travel and car expenses for rent collection
   7. inspections of property and maintenance.
4. Sun protection: It might sem odd but did you know you can claim for sunglasses if, as part of your employment, you are required to work outside for prolonged periods. There’s no limit on how much you can spend on sunglasses but remember that if they are more than $300 the ATO expects that they should then last for more than 12 months – meaning you should claim the depreciation on the glasses rather than an upfront deduction.
5. Self-education expenses: You can claim self-education expenses if there’s a connection between the course and your role in your business. You could be entitled to a tax deduction for expenses including the following:
   1. Textbooks, professional and trade journals
   2. Stationery
   3. Photocopying
   4. Computer expenses
   5. Student union fees
   6. Student services and amenities fees
   7. Accommodation and meals, only when participating in your course requires you be away from home for one or more nights
   8. Running expenses if you have a room set aside for self-education purposes – such as the cost of heating, cooling, and lighting that room while you are studying in it
   9. Allowable travel expenses.

The information provided here is of a general nature for Australia and should not be your only source of information. Please consult an experienced and registered tax agent as each small business’ circumstances will vary for the end of the financial year.

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