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Everything You Must Know About Small Business Tax Deductions

It will be in a business’s best interest to pay taxes because it will suffer severe consequences. Even small businesses aren't exempted from paying taxes in a country like Australia. However, not many small business owners know about their tax deductions.

Small business tax deductions are necessary. They are vital, especially because they can reduce the amount of tax that you have to pay. Deductions can be found in the form of business expenses, travel expenses, and even your home office deductions. Still, there might be some small business owners who aren't aware of the tax deductions that they can claim. We'll discuss these tax deductions in this article, so read on below to get started.

Startup and Organizational Costs

If you're starting up your own small business, there are expenses that you have to keep in mind. These expenses are grouped under the category of startup and organizational costs. They include the cost of your business registration, legal fees, accounting fees, and other similar expenses.

If you have incurred these costs and are using your business to earn income, you can apply for tax deductions for the said expenses.


Inventory is any property that your business owns that you can switch to trading by selling to other people. You have to keep in mind that you can only claim the cost of the items you have on hand, not your inventory cost.


When you're running a small business, you have to be insured. This is because insurance can protect you from any unexpected events or accidents. Your company will be insured so that your business can be protected from any damage that might occur. However, you have to claim the insurance premium you paid during the year.

Office Supplies

There's a difference between office supplies and office equipment. Office supplies refer to pens and paper, while office equipment refers to computers and printers. The office supplies that you bought for your business can be claimed as a tax deduction.


Utilities refer to the costs that you paid for the services that your business uses. This includes electricity, gas, water, and more.

Advertising and Marketing

The amount of money you spend on advertising and marketing your business can be claimed as a tax deduction. However, there are some rules that you have to follow.

First, you can only claim the deduction if you prove that your advertising and marketing efforts increase your income. Second, you can only claim the advertising and marketing expenses you paid. This means that you need to have the receipts to support your claims.

Auto Expenses

If you own the business, your car is also part of your business. That's why you can claim the expenses you incurred in your business car. This includes fuel, maintenance costs, and even toll payments that you made using your business car.

Property and Equipment Rent

If you own any property and equipment for your business, you can claim the rent you paid for them. You have to remember, though, that you can only claim the rent if you're using the property and equipment for their specific purpose.

Software Subscription

This refers to the costs you incurred in paying for the software you use in your business. You have to keep in mind that this tax deduction can be limited depending on the amount of Gross Income.


If you're running a business, you need money to pay for your expenses. You may have to take a loan or use your business credit card to pay for your business expenses. If you're using a loan or a credit card, you can claim the interest you paid for the borrowed amount or the credit card balance.

Business Entertainment

There are business entertainment expenses that you can claim as a tax deduction. However, you need to follow some rules, too. For example, business entertainment expenses are only deductible for employees. This means that you have to have your employee's receipts.

Travel Expenses

If you're traveling to conduct your business, you can claim the travel expenses you incurred. This includes the costs of your transportation, accommodation, and meals.

Bad Debt

When you extend a loan to your clients, you have to keep in mind that you might not be able to collect your loaned amount. If this happens, you can claim the amount you have loaned as a tax deduction.


These are some of the tax deductions you can claim as a small business owner. These tax deductions are essential to reducing the amount of tax you have to pay. Because you're running a small business, you need every tax deduction that you can get to get the most money possible to keep your business afloat.

If you’re looking for small business accountants in Gold Coast, New Wave Accounting has got your back! Our team of experienced accountants will ensure that your transactions are all on record, all for affordable prices. Reach out today and allow us to help you!

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