Tax time can come around quickly when you’re busy running a growing business, but a little preparation now can make a big difference later.

Whether you lodge your own tax return or use a registered tax professional, there are things you can do now to get ready and avoid last-minute mistakes.

Set yourself up online

Online services for business is your central hub for managing tax and super online.

If you haven’t already, set up your access. You’ll need to:

• download and set up your myID, the Australian Government’s Digital ID app
• link your myID to your ABN in Relationship Authorisation Manager (RAM).

Tip: Sole traders can engage with us through ATO online services through myGov or the ATO app. Signing in with myID gives you more secure and flexible access.

Declare all business income

Missed income is a common issue at tax time. Make sure you declare all your business income, including cash payments and non-monetary benefits like goods or services you receive for your work.

Know your losses

Knowing whether your losses are business losses or non-commercial losses can change how you report and carry them forward at tax time.

Separate business from personal expenses

If you’ve used business money for personal expenses, keep good records. Separating business and personal spending now can help prevent issues later.

Nominate your tax professional

If you’re using a tax professional, nominate them in Online services for business so they can access your information and act on your behalf without delays.

Claiming deductions

When claiming deductions, remember these 3 golden rules:

1. The expense must relate to your business, and not private use.

2. If the expense is for a mix of business and private use, you can only claim the business portion.

3. You need records or receipts to prove it.

Remember, if you’ve incurred general interest charge (GIC) or shortfall interest charge (SIC) on or after 1 July 2025, you can’t claim these amounts as an income tax deduction in your 2025–26 or later tax returns.

Cash or accruals: choose the right method

All income you earn from running your small business will be assessable for tax purposes. The method you use to account for income affects what you report. For:

• cash basis, report income when you receive the payment, even if the work was done earlier
• accruals basis, report income when you earn it, even if you haven’t been paid yet.

Generally, you should only report on a cash basis if your business income is principally a result of your own labour.

Don’t miss out on deductions and concessions

Check if you’re eligible for any deductions or concessions such as:

• simplified depreciation rules
• immediate deductions for pre-paid expenses
• depreciation for instant asset write-off.

Tools and support for tax time

We have a range of tools and resources, including our 2026 Tax Time toolkit for small business to help you get it right this tax time.

Keep up to date

We have tailored communication channels just for small businesses – so you’ll always be up to date with the latest information and changes relevant to you.

Explore more articles in our Small business newsroom.

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