Top tips for sole traders

Tax time for a sole trader can be stressful, however with a little planning you don’t need to dread doing your tax return.

Take Benzi for example. Benzi is a self-employed professional tiler whose total gross business income is $82,000 per annum.

Benzi knows that he’ll have a tax bill at the end of the financial year, so he decides to set up weekly payments from his business account to the ATO to cover the bill.

Benzi also follows tips he received from his tax agent and the ATO website. This ensures he can meet his tax obligations, which makes tax time a smoother experience.

• Benzi is registered as a business, as he’s carrying on an enterprise and is registered for GST because his business has a GST turnover of $75,000 or more.
• He reports all assessable income, including non-monetary payments and payments in kind.
• He claims deductions for expenses, but only claims the business portion of an expense if it’s for both business and private use, including for his motor vehicle.
• He correctly reports any personal services income (PSI).

Benzi uses the ATO app to access and manage his tax and super, and the ATO myDeductions tool to capture expenses as they happen.

Be like Benzi and find more information at ato.gov.au/sbsupport or speak with the team at Paris Financial. We’re here to help you with your tax. Contact us today!

Source: ATO Newsroom