If you run a small business in Australia — sole trader, partnership, trust or company — you have to lodge an income tax return with the ATO every year. This guide walks through the whole process in plain English so you know what's due, when it's due, and what you can claim.
Key tax return deadlines
- 31 October — if you lodge your own return without a tax agent, this is your deadline for the financial year that ended 30 June.
- 15 May (following year) — most small businesses lodging through a registered tax agent get an extended deadline, provided they're on the agent's lodgement program before 31 October.
- Quarterly BAS — 28 October, 28 February, 28 April, 28 July. Add ~4 weeks if lodging through a BAS agent.
- Super guarantee — quarterly, by the 28th of the month after quarter-end. Late super isn't deductible.
What you need to lodge
The exact return depends on your business structure:
Sole trader
Individual tax return with business schedule. Reports business income, expenses and personal income on the one return.
Partnership
Partnership tax return — informational only. Each partner then includes their share in their own individual return.
Company
Separate company tax return. Taxed at 25% (base rate entity) or 30%. Directors lodge their own individual returns for salary or dividends.
Trust
Trust tax return. Beneficiaries report their distributions in their own returns.
Sole trader vs company — what changes?
The biggest practical difference for tax time is how profit is taxed. Sole traders pay tax at marginal individual rates (0–45%) on every dollar of business profit. Companies pay a flat 25% if they qualify as a base rate entity, but profit drawn out as wages or dividends is then taxed in the owner's hands.
If you're a tradie or service business turning over under $300k, a sole trader return is usually the simplest and cheapest option — see our bookkeeping for tradies page for how we package it.
Deductions you can claim
You can claim any expense incurred in earning your business income, as long as it's not private and you have a record. Common categories:
- Motor vehicle expenses — logbook or cents-per-km
- Tools, equipment and depreciation (instant asset write-off where eligible)
- Home office: occupancy and running costs
- Phone, internet and software subscriptions (Xero, MYOB, etc.)
- Subcontractor payments (don't forget TPAR if you're in building or cleaning)
- Wages, super and workers comp for employees
- Insurance: public liability, professional indemnity, income protection
- Accounting, bookkeeping and tax agent fees
- Marketing, advertising and website costs
- Bank fees, merchant fees and interest on business loans
BAS vs annual tax return
These are two different lodgements that often get confused. BAS reports GST, PAYG withholding and PAYG instalments — usually quarterly. Your annual income tax return reports your profit for the financial year. Clean, on-time BAS lodgements make tax-return season painless because the numbers already reconcile.
Lodgement checklist
Before you (or your tax agent) lodge, gather:
- Reconciled bookkeeping file (Xero, MYOB, QuickBooks) for 1 July – 30 June
- All four quarterly BAS lodgements reconciled
- Bank statements for every business account and loan
- Asset purchases and disposals with invoices
- Payroll/STP finalisation completed
- Stocktake (if you carry inventory)
- Logbook and odometer readings for vehicles
- Records of any personal use of business assets
Common small business mistakes
- Mixing personal and business spending — pay yourself a wage or drawing, don't blend the accounts.
- Missing the super deadline — late super isn't deductible and attracts the SGC penalty.
- Forgetting TPAR — building, cleaning, courier, IT and security businesses must report subbie payments annually.
- No logbook — you can't claim more than 5,000km per year on cents-per-km without one.
- Lodging late without an agent — penalties start at $313 per 28 days, capped at $1,565.
Want us to lodge it for you?
Priory is a registered BAS & Tax agent based in Mandurah, serving small businesses Australia-wide. Flat fees, no lock-in, and a real human on the phone.