Tips to help sole trader clients

The ATO is seeing sole traders make mistakes in the following areas:

• not reporting all income — this includes income earned outside their business (like a 'side hustle'), cash jobs, or payments in-kind/barter deals;

• overclaiming expenses — this includes claiming the portion of an expense related to personal use, or overstating the cost of goods sold and other business expenses;

• calculating business losses;

• incorrectly claiming and offsetting losses from non-commercial business activities against other income sources;

• misreporting personal services income ('PSI') to gain tax benefits;

• not registering for GST if they are in the taxi or ride-sourcing industry, or when they reach the GST threshold; and

• not keeping accurate and complete records.

If you need assistance with any of the above, please contact our office.