As June 30 approaches, thousands of women business owners across Australia are unknowingly leaving money on the table.
While you’re focused on running your business, there are legitimate tax deductions sitting right under your nose; deductions that could significantly reduce your tax bill if you know where to look.
H&R Block’s Director of Tax Communications, Mark Chapman, highlights the most commonly overlooked opportunities and shares his expert advice on maximising your tax return without crossing any lines.
The deductions you’re probably missing
When asked about the most commonly overlooked tax deductions by women running their own businesses, Chapman immediately points to several key areas that business owners consistently miss. “If you’re a member of a professional or trade association as part of your work, you can claim a deduction for the amount you pay in subscriptions,” he explains.
This extends beyond just membership fees to include union fees and subscriptions to trade or professional magazines, or even investment publications if you’re an investor. “Don’t forget, if you prepay your fees or subscriptions for the next tax year before 30 June 2025, you can claim a deduction this year, which can be a useful timing benefit.”
The rental property goldmine
For business owners with investment properties, Chapman notes that while most people know about claiming mortgage interest, there’s a wealth of other deductible expenses that often go unclaimed. “Most people with a rental property know that you can claim a deduction for the interest element of the mortgage but there are plenty of other deductions you can claim on a rental property, many of which are often overlooked,” he says.
The list of claimable expenses is extensive and includes gardening and lawn mowing, bank fees, pest control, security patrol fees, bookkeeping costs, repairs, end-of-lease cleaning, letting agent fees, strata costs, land tax, credit checks on prospective tenants, advertising for tenants, debt collection fees, new keys, servicing of hot water heaters and smoke alarms, and even quantity surveyor fees for depreciation reports.
Don’t forget your tax affairs
Mark points out that your tax preparation costs are themselves tax deductible. “If you paid for a tax professional to complete last year’s tax return, you can claim a deduction for the cost in this year’s return.
Better still, you can also claim a deduction for any travel costs you incurred in getting to and from your agent.”
The fashion and beauty reality check
One of the most frequent questions Chapman receives relates to fashion and beauty expenses for business owners. His advice might disappoint some, but it’s crucial for staying compliant. “If you’re required to wear a uniform at your workplace, the cost of purchasing the uniform is claimable and you can also claim for the cost of cleaning the uniform,” Chapman clarifies. However, he emphasises that conventional clothing doesn’t count as a uniform – ideally, any claimable garment should have the business logo on it.
The news isn’t great for office workers: “You can’t claim the cost of purchasing or cleaning clothes you bought to wear for work that are not specific to your occupation, such as a business suit. Bad news for office workers!” Even activewear for fitness professionals falls into this category, as he explains: “This restriction also applies to activewear if you work in a fitness job – this is generally regarded as conventional clothing and not claimable.”
Personal grooming expenses are similarly restricted, with him noting they “are not generally deductible as they are regarded as a private expense,” though he acknowledges rare exceptions for specific professions like airline cabin crew.
Advice for service-based businesses
For women in wellness or service-based businesses like consultants, personal trainers, or content creators, Chapman’s advice is refreshingly simple: “You can claim anything provided it’s directly related to your income.”
The EOFY action plan
Chapman’s end-of-financial-year checklist focuses on several key strategies to maximize deductions legally and effectively.
Take advantage of the instant asset write-off
“One of the best tax breaks for small business is the instant asset write off,” he explains, noting that businesses can claim immediate tax deductions for capital assets costing up to $20,000 if their business turnover is less than $10 million.
With many businesses offering End of Financial Year promotions, now is the ideal time of year for your business to take advantage by acquiring some much-needed assets to build your business and, at the same time, reduce your taxable profits.”
Items eligible for the write-off include cash registers, POS devices, delivery vans under $20,000, office fittings, computers, security systems, accounting software, and various plant and equipment. He recommends several timing strategies to optimize your tax position. These include deferring business income by holding off on invoicing until July 2025, prepaying certain business expenses that cover periods of no more than 12 months, and ensuring superannuation contributions are paid by June 30 rather than waiting until the July deadline.
For businesses with bad debts, Chapman suggests reviewing your debtors list: “If there are any debtors on it who you believe can’t or won’t pay, write off those debts by 30 June to claim the deduction this year.”
The golden rules
When asked what every woman in business should do before June 30, he returns to the fundamentals with his three golden rules for work-related expenses: “The expense must relate to your work. You mustn’t have been reimbursed by your employer. You must be able to prove that you spent the money. That means that you must keep receipts, invoices or statements to demonstrate that you actually incurred the expense.”
Chapman’s final piece of advice emphasises the importance of good record-keeping: “H&R Block’s tip is to keep electronic copies of all documentation relating to expenses. Paper receipts get lost or fade, so keeping everything together on your phone or computer will save time and effort when you come to complete next year’s tax return.”
As the June 30 deadline approaches, his message is clear: take the time between now and year-end to ensure all your receipts and invoices are in order, and don’t hesitate to approach retailers for duplicates if you can’t find original documentation.
The key to maximizing your tax return lies not just in knowing what you can claim, but in maintaining meticulous records to support those claims.
As Mark puts it, good record-keeping is your best friend for efficient business management and will make life easier if the ATO comes knocking.
Also by Mark Chapman:
- Your taxes under Albanese: What the changes mean for you
- Everything you need to know when kicking off your start-up
This is general information only. Please seek professional tax advice for your specific situation.
Keep up to date with our stories on LinkedIn, Twitter, Facebook and Instagram.
