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Tax tips you must know for your Small Business

As a small business owner, do you find yourself worrying about managing your taxes? Although the government offers a range of benefits to small businesses when it comes to taxes, you might still end up paying more than needed. Thus, to help you get your small business taxes right, here are a few tips you can implement.

Small Business owner

Separate your personal and business finances

Does this tip sound like common sense to you? Then you would be astonished to know how many small businesses end up muddling both finances. Without differentiating personal and business expenses, your chances of accidentally claiming a personal expense over a business one increase. Such a mistake will subject you to Refund fraud, which is taken seriously by the ATO.

Another reason for keeping these two separate is to maximize your deduction. You can track your legitimate expenses easily and check if they fall under any deduction schemes. You can achieve this by opening a separate bank account for business transactions. Just following this tip will make the whole taxation process easier for you.

Pay attention to the deductions offered

Small businesses can take better advantage of deductions than others if they pay enough attention. Because you had to spend quite a good amount to produce the assessable income, you are entitled to tax deductions. These deductions are completely legal as long as you prove you had to incur the expenses for business purposes.


The following are some small business tax deductions you may claim:

  • Business travel
  • Insurance
  • Depreciating assets
  • Repairs and maintenance
  • Superannuation
  • Tax management expenses
  • Fringe benefits
  • Advertising and sponsorship
  • Telephones
  • Salary and wages
  • Work from home claims

Besides these, there are a couple more tax deductions for small businesses in Australia. However, they have specific requirements that you would have to check.

Keep good records to save money

When running a small business in Australia, you need to keep track of every receipt or expense made for the business. Doing this will help you avoid mistakes that might otherwise lead to penalties. Records will help you study the trends in your business.

save money

With all the available data regarding expenses and income, you can make decisions about future investments. You can reduce your tax liabilities and maximize profits with the right steps. Here are some of the mandatory records:

  • Sales receipts
  • Bank statements
  • Expense invoices
  • Credit card statements
  • Employee records
  • Asset purchased
  • Vehicle records
  • Lists of creditors and debtors

You can keep these electronically, but ensure that these are easily revertible in case you need to show evidence to the ATO.

Pre-paid expenses

Did you know you can claim deductions for the coming year’s expenses if you pre-pay them? Rent, insurance and subscriptions to a professional body are some expenses you can pre-pay for the next financial year. Surprisingly, you can claim the deductions because you paid them in the current financial year.

Need assistance?

Need assistance

Managing taxes for a small business that is still in the growing stage can take time and effort. If you need small business tax advice, Clear Tax Accountants can help you. We are a team of professional accountants who can help you take care of your tax matters. So, contact us today!

Disclaimer: The information on this website is for general purposes only and should not be relied upon for making legal or other decisions. The advice provided in this article is general in nature and is not subject to the personal financial situation and needs of any individual. Clear Tax tries to keep the information accurate and up-to-date; however, you should bear in mind with changing circumstances, the accuracy and reliability of the information will not necessarily remain the same. The information is by no means a substitute for financial advice.