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10 July 2019
The Australian Taxation Office is lending a helping hand to millions of small businesses to get their tax right.
Assistant commissioner Peter Holt said the ATO understands that small businesses have a lot on their plate with the day-to-day running of their business.
“That’s why we’re focusing on addressing common issues we see when small businesses lodge their returns so that we can support them to get it right,” he said.
ATO focus areas
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Mr Holt said the top three issues the ATO sees when small businesses lodge their tax returns are:
• Failing to report all of their income.
• Not having the necessary records to prove small business expenses claims.
• Claiming private expenses as business expenses.
“For example, you’re a sole trader landscape gardener who usually works in Perth but took on a job in Broome. While you’re up in Broome, you do some sightseeing. That’s a private expense and you can’t claim the cost of that in your tax return,” Mr Holt said.
He said there are three golden rules to remember about claiming deductions.
“One, the expense must have been for your business not yourself. Two if you use something for business and private purposes, you can only claim the portion that is related to your business, and three, you need a record to prove it.”
Mr Holt said the top tip for small business operators is to ensure that their records are kept up-to-date.
“Good record keeping will help you complete and lodge your tax returns, manage cash flow, meet your tax obligations and understand how your business is doing,” he said.
The entire July 10, 2019 edition of The Weekly Advertiser is available online. READ IT HERE!