Hi, finally I am taking the plunge and will launch my own business from July this year. My question is if I incur expenses in setting up the business like website, marketing material before July will I be able to claim the expenses in this financial year?

Thank you

Hi Penny.

Congratulations on the big step!!

The expenses incurred this year MAY be deductible this year, however this depends on a whole raft of factors:
1: establishment costs. these are generally deducted over a 5 year period
2: operating costs would be deductible IN GENERAL, but again, it depends on a few things.

You need to take into account what the business structure is, and WHO is actually incurring the expense. for example, if you intend to trade using a company, and incur establishment fees, the tax deduction for this should be claimed by the individual who set up the company, because (logically) a company cannot incur expenses until it exists: it cannot exist until someone pays for this to take place.

There is also a set of rules around non-commercial business losses that you also need to take into account, which may or may not affect you.

the best thing you can do now, is talk to a good bean counter about your business, so you can cover off all these issues, as well as a heap of other things that will impact you and your business.

find yourself a CPA or CA with expertise in setting up and advising new small businesses, and have a chat with them, it will most likely pay for itself several times over.

good luck

BC

Hi Penny,
I agree with everything Brendan said, and also make sure you have specific commercial legal advice.
Also ask your 'bean counter' for tax planning advice - work out what you're going to do in advance so you're prepared.

Good luck Penny, and Welcome to the challenging and very rewarding world of small business :-)

Graham