Deductions sole traders often overlook

Check each expense against its business purpose, the deduction rules and the records supporting it. Paying from a business bank account does not make a private expense deductible.

• Phone and internet: identify business use and keep the calculation.
• Vehicle use: retain the records required by the method you use.
• Insurance, software and professional fees: check what the payment covers.
• Equipment: check whether depreciation or an eligible immediate deduction applies.

For mixed business and private use, claim only the eligible business portion. If you are registered for GST and entitled to a GST credit, exclude that credit from the income-tax deduction. Keep invoices, receipts and the basis of your calculation.

Official sources

• ATO: business deductions
• ATO: business record-keeping rules

Checked 13 October 2026. General information; the rules for your circumstances and reporting period still apply.