Happy New Year. As the Australian tax landscape continues to evolve, it’s more important than ever for business owners to stay up-to-date on the latest available deductions. At RR Eleven Accounting, we’ve put together a list of 10 key tax deductions that could offer valuable benefits to your business in 2025. Let’s take a closer look at how these deductions can help you save and optimize your tax strategy!
1. Build to Rent (BTR) Development Incentives
The Australian Taxation Office (ATO) has introduced new incentives for eligible BTR developments:
- Faster Depreciation: The capital works tax deduction rate has increased from 2.5% to 4%, shortening the depreciation period from 40 to 25 years.
- Lower Withholding Tax: The rate for eligible fund payments from managed investment trusts has dropped from 30% to 15% for income generated by eligible BTR developments.
To access these incentives, BTR owners must notify the ATO and meet eligibility criteria over a 15-year compliance period.
2. Small Business Meal and Entertainment Expenses
While not yet law, the Coalition has proposed allowing small businesses with a turnover under $10 million to claim tax deductions of up to $20,000 for meal and entertainment expenses. This two-year initiative aims to support local economies and the hospitality sector. Keep an eye out for updates on this potential deduction.
3. Working from Home Expenses
With remote work becoming increasingly common, the ATO continues to allow deductions for home office expenses. Claimable items include:
- Internet expenses directly related to work
- Stationery and other consumables
- Home office equipment (printers, computers, etc.) up to $300
Remember, you can’t claim expenses reimbursed by your employer or costs for items used for personal purposes.
4. Professional Development and Education
Investing in your skills or your employees’ skills remains tax-deductible. This includes:
- Course fees for work-related education
- Textbooks and stationery
- Travel expenses related to attending courses or seminars
5. Vehicle and Travel Expenses
If you use your vehicle for business purposes, you can claim:
- Fuel and oil costs
- Registration and insurance
- Repairs and servicing
- Lease payments
- Depreciation
Remember to keep a logbook to accurately calculate your business-use percentage.
6. Advertising and Marketing
Promoting your business is essential, and the good news is that these expenses are generally tax-deductible:
- Online advertising costs
- Print media advertisements
- Promotional materials (brochures, business cards, etc.)
- Sponsorship expenses
7. Technology and Software
In our digital age, technology is crucial for business operations. You can claim deductions for:
- Computer hardware
- Software subscriptions and licenses
- Cloud storage services
- Cybersecurity measures
8. Superannuation Contributions
Don’t forget about super contributions for your employees. These are tax-deductible if paid on time. The superannuation guarantee rate for 2024-2025 is 11.5% of an employee’s ordinary time earnings.
9. Bad Debts
If you’ve made a genuine attempt to recover a debt but have been unsuccessful, you may be able to claim it as a tax deduction. Ensure you have documentation to support your claim.
10. Instant Asset Write-Off
The instant asset write-off threshold has been extended to 30 June 2025. Small businesses with an aggregated turnover of less than $10 million can immediately deduct the business portion of most assets that cost less than $20,000 each.
Stay Informed and Compliant
Remember, tax laws and regulations can change. It’s crucial to consult with a professional accountant to ensure you’re maximizing your deductions while remaining compliant with ATO regulations.
At RR Eleven Accounting, we’re committed to helping Australian businesses navigate the complexities of taxation. Contact us today to learn how we can help you optimise your tax strategy for 2025.