tax deduction

Deduction of labour costs related to creation of capital assets

The ATO has released TR 2019/D6, which provides the ATO’s preliminary view on the application of para 8-1(2)(a) of the ITAA 1997 to labour costs related to the construction or creation of capital assets. This draft ruling applies to taxpayers incurring labour costs that are: salary and wages for employees who are engaged to construct

[ Read More ]

Interest deductibility after income-producing activity ceases

  An issue that sometimes arises for business owners is whether interest expenses incurred on borrowed funds used in a business remain deductible after the business’s income earning activities have ceased. As a general rule, in order for interest expenses to be deductible in the relevant income year, a taxpayer is generally required to demonstrate

[ Read More ]

Business client tax loss deduction denials

  Business owner clients may need to be reminded that they should not get too creative if they’ve thought how handy it would be to absorb a business loss as a tax deduction — especially under certain circumstances as described below. The ATO has the discretion to disallow the deduction of a tax loss if,

[ Read More ]

What types of legal expenses are tax deductible?

What types of legal expenses are tax deductible? When a legal expense is incurred in relation to the operation of a business to produce assessable income, it is generally allowable as a deduction. Exceptions are when the legal fee is capital, domestic or private in nature, if it is specifically excluded by another section of

[ Read More ]

Claims for electronic devices, phones

That technology has changed many aspects of our daily lives is a widely accepted fact of life, and no doubt more is just around the corner. Claims for electronic devices, phones The proliferation of electronic devices of all kinds has also pervaded our work and home environments to such an extent that the line dividing

[ Read More ]

Deduction for association subscriptions — eligibility can endure into retirement

Many professional, business or trades people are members of an association, and during their working life subscribe to an appropriate organisation. Deduction for association subscriptions In most cases the membership of a trade union for example, or professional association relevant to workers in a particular occupation, would qualify for deduction under the general deduction provisions

[ Read More ]