Sole trader or partnership income
Business income counts in the income test.
If you’re a sole trader or in a partnership, you must report it to us. Read about income reporting.
What goes into the income test
Your assessable income as a sole trader or business partner is the gross income minus the deductions we allow.
If you’re a sole trader
All the income counts in your test. You can deduct some expenses.
If you’re in a partnership
The income that counts in your test depends on how big your share of the business is. The partnership agreement says what this is.
You can deduct some expenses.
What deductions we allow
You can’t claim as many deductions in the income test as you can in your tax return.
What you can claim
You can claim:
- costs needed to earn business income
- depreciation of business assets
- employee superannuation.
What you can’t claim
You can’t claim:
- past year losses
- losses from another business
- superannuation for sole traders or business partners
- some capital costs.
What details we need
You’ll need to give us:
- your most recent annual financial statements, or
- a profit and loss statement for a recent period, usually 13 weeks.
A profit and loss statement for a recent period is only needed if:
- you don’t have an annual statement yet
- the income has changed since the last statement.
Page last updated: 30 September 2019