Business and travel

What about photography.

You travel around take some snapshots, then return and display them all in a "gallery" or under the house (artistic licance). Have a gallery opening party. Sell one or two shot to your mates and ride it all off on tax.

I don't really know if that's possible, but it would be good to find out.

R.

contact the ATO

mining lease,
allows you to leave it inactive, manage it, and be a primary producer, to buy equipment for the business tax exempt also.

But best you pay your accountant the big $ to set you up correctly.

You have to pay tax to claim tax.
Leroy

You also need to prove its not a hobbie , and has the potential to actually earn money

You could try working for a 4WD tag-along company or start your own.

Wayne

Get Accountant
Pay Accountant
Fill out forms
Fill out more forms
Paper trail
Argue with ATO
Pay Accountant to argue with ATO
Register Business Names
Set up Bank Accounts

Shall I keep going?

Business.......... either you are in business, or not, simple.

Cheers

Wolfie

Leroy sums it up. Lone Wolf brings in accountants into story. My advice to anyone setting up a business is to consult an accountant first, to ensure it is set up in the most tax effective way. If travel is only part for business, only some can be claimed anyway. Tax Office may not accept you as a business if what you set up does not eventually make a profit - then you pay tax anyway. No easy way out there - fall foul of the Tax Office and your in deep - - - -

We did the following on a 5 year sojourn through Oz with a 4x4 and caravan. Bush camped 90% of the time.

Wrote for 4x4 magazine
Wrote for 4x4 book series
Took photos and sold them to publishers
Make craft items out of MDF and sold them to shops and markets
Picked fruit when the going got tough

Accountant looked after us legally and we minimised our tax. Never had an issue with the ATO but then again we weren't exactly in the big money bracket..........

Your answer is a novated lease, try smb novalease. They should be able to guide you on if this is applicable to your current employment.

If you can get them working with your employer, it will come out of your pretax pay.

Just keep the KMs/year up, say over 25K to reduce your FBT and little Johnny is your Uncle.

I am an employee of a company who supplies me with a 4wd vehicle which they pay all fuel ,repairs , travelling expenses , etc etc . The company directors are real lousy b@#$&ards as they pay me a very small salary and nearly keep me broke but while ever they keep supplying me with a vehicle free of any expenses , company clothes , food , fishing gear , boats and canoes and other bits and pieces I will stay with them , by the way the company has to have at least 1 annual general meeting ( ours has about 6 ) and if the directors decide that that meeting shall take place on the banks of Coongie Lakes in SA over a certian period then the company also cover the cost of directors etc getting to , staying and getting back home again , you do have to have the meeting and record the minutes etc etc.
Companies cost about $1,000 to set up and pay tax at a 30% rate , but you must of course have a legal business to use the company for as fraud is frowned on by the ATO but genuine companies operate with the ATO 's blessing . The company can also negotiate with its workers ( work place agrreement ) to say pay for a workers medical expenses , supply them with a company house , renovate that house for their employee's , supply food and drink through the company cafateria .
Done legally and within the ATO's guide lines companies are a good way to go but see a good accountant who knows companies inside and out and who also has good contacts with legal proffession who know company law etc and can set up family trusts etc if you wan't to go further along the way .
Your company is no different from say BHP , CBA ,TLS etc etc .
Damn lousy ba$%&@#ds I work for
Cheers

The "expenses" you incur in your side business are only decutable against income from that business.

That is to say that losses from your busness are not deductable against your salary.

The ATO put the kybosh on this trick long ago.

I'm not guessing here, I work for a salary and own a business.

Cheers,

Jim.

As Jimbo points out, costs can only be offset against income from the same business. Kenny's structure is entirely sound and legitimate. But the costs of his vehicle and extras can only be offset against income derived from the business he is a director in.

Austravel's original request was for a 'business on the side that doesn't make money and is simple to operate'. The business would need to generate an income, which his travel costs could be offset against thus reducing any tax payable on the NETT income of that business.

But the ATO would expect that the intent of the business is to eventually make money (and hence pay tax). If the business exists simply as a means for generating a tax loss, then the ATO would deem the business not to be real.

The charter boat industry has been thru a real ordeal over the last few years on this very topic. It used to be OK to own a charter boat, which was rented out for a a few weeks (or even many weeks) of the year to help generate some income. Generally the rental income was less than the running costs. The boat's owners would then use the boat for a few weeks of the year during their holiday, but the whole cost of the boat would be offset against their entire taxable income. Unfortunately, the ATO ruled that this was not a true business and that the boat's running costs could only be offset against it's income (ie the boat owners could no longer offset the boat's operating costs against their total income including any external salary).

This of course had a major effect on the charter industry but that's a different story.

So the summary is, Austravel's business on the side, would need to generate an income, which he can legitimately offset the costs of the business against. But the plan for the business must be to eventually be profitable and pay tax.

Unfortunately, the ATO works hard to ensure no-one gets a free lunch.

My 2.2cents worth (inc GST)

Andrew

Mate - get the accountant to explain the "non-comemercial losses" provisions of the tax act.

Austravel,

I suggest you spend a bit of time on the ATO web site and if you then believe you have a viable business plan discuss it with an accountant who is Tax Office savvy.

In the mean time this might help you:

"When can you deduct a loss?

You can offset a loss from a business activity against other income if the business activity passes at least one of the following four tests. It may:

- have assessable income from the activity of at least $20,000

- have produced a profit in three out of the past five years

- use real property or an interest in real property worth at least $500,000, on a continuing basis, or

- use other assets worth at least $100,000, on a continuing basis.

If an activity does not pass any of these tests, you may still claim a loss if the Commissioner decides to exercise a discretion to allow the loss to be offset against other income.

You may also offset a loss if your business activity comes within the exception to these rules, which may apply to primary production and professional arts business activities in certain circumstances.

If your business activity qualifies for the exception, passes one of the four tests, or the Commissioner exercises the discretion, you can offset the loss from that business activity against other assessable income for the current year."

Good luck.

Contact BANTACS (Beachmere and Ningi Taxation Accounting & Computer Services ) at www.bantacs.com au They have an article that tells you how to claim your trip around Aurtralia as a tax deduction. Regards G.T.