Can You Claim Tax if a Private Seller Sells You Something for Business Use?

• 

  geekcohen on 04/01/2024 - 05:54

  +1

  A handwritten receipt will be fine the only requirements for a receipt is that it must include the following -

  • name of the supplier
  • amount of the expense
  • nature of the goods or services
  • date the expense was paid
  • date of the document

  If a purchaser is unable to obtain a receipt from a supplier they can still claim a deduction if we are satisfied that the nature and quality of the evidence shows they spent the money and are entitled to claim a deduction. Evidence of their expenses can include a bank or credit card statement that shows the amount that was paid, when and who it was paid to as well as other documents that outline the nature of the goods or services provided.

  Source

  • 

    Aerith-Waifu on 04/01/2024 - 06:03

    What about a typed copy of the receipt but the seller signs it with the the 5 points above included? or does it has to be hand written?

    • 

      geekcohen on 04/01/2024 - 06:11

      I think a typed one would probably be better and then signed accordingly. It would be easier to understand.

      • 

        Aerith-Waifu on 04/01/2024 - 06:17

        Ok thank you.

• 

  shaun83 on 04/01/2024 - 08:22

  The ATO has a form for this situation (on top of an informal receipt_

  Information: https://www.ato.gov.au/forms-and-instructions/statement-by-s…
  Form: https://caat-p-001.sitecorecontenthub.cloud/api/public/conte…

  The 2nd link is the link to the PDF from the ATO website - domain looks dodgy so perhaps just click through to the form from the ATO instructions link

  • 

    Aerith-Waifu on 04/01/2024 - 17:56

    Interesting indeed

• 

  JimmyF on 04/01/2024 - 09:06

  If the shelves are say $400 in total. Can a hand written note be valid for tax deduction?

  Sure you can deduct anything at tax time, only when audited will you find out if the ATO accepts it or not.

  In your cast, this would be a ex GST cost on the books.

  • 

    freefall101 on 04/01/2024 - 10:22

    -1

    That's a bit like saying "it's only illegal if you get caught", they clearly asked if it's valid (which it is).

    They're also buying it off a private seller, there is no GST.

    • 

      JimmyF on 04/01/2024 - 10:36

      That's a bit like saying "it's only illegal if you get caught"

      Far from it, many large companies have taken the ATO to court over the interpretation of Tax law and won. The tax laws are open to interpretation on many levels. So yeah, you can claim anything you want, you just have to be able to prove a valid reason/ATO law to support it. In this case as I said, they can claim a deduction but no GST.

      If you want to get cranky at something look at the mining and oil companies making billions of profit a year but paying zero to no tax….

      • 

        freefall101 on 04/01/2024 - 10:53

        That's because the ATO administers the law, they don't write it. You can take anything to court and win because the courts are the one who determine what the law says. That doesn't mean you can claim anything you want, it means you can claim anything you are legally allowed to. That applies to all things in life, not just tax.

        There are no companies making billions of profit and paying zero tax, there are companies making billions in revenue though. Exxonmobil was a good example, they claimed all their development costs meant they made zero profit in Australia (because they were paying off loans that just happened to come from the Bahamas). They never won any court cases over that though. Chevron lost a massive case trying to avoid tax that way.

        In this case as I said, they can claim a deduction but no GST.

        You said it'd be ex GST, that's totally different to no GST.

        • 

          JimmyF on 04/01/2024 - 10:58

          @freefall101:

          You said it'd be ex GST, that's totally different to no GST.

          It is an ex GST deduction as there isn't any GST on it….

          • 

            freefall101 on 04/01/2024 - 12:48

            +2

            @JimmyF: Ex GST means excluding GST or exclusive of GST. Since the GST is zero, they just record the amount, there's no need to be redundant. The term is only used when recording transactions that have GST, to say whether a deduction needs to include the GST portion or not, it most definitely doesn't mean a transaction with no GST on it. Source: I'm an accountant.

            Might as well they need to record it inc GST, because the GST is still zero either way.

            • 

              JimmyF on 04/01/2024 - 12:56

              @freefall101:

              Ex GST means excluding GST

              Correct. Did this deduction have GST on it? No…

              there's no need to be redundant

              But here you are.

              The term is only used when recording transactions that have GST

              The code is ex GST in most accounting software ;)

              Might as well they need to record it inc GST, because the GST is still zero either way.

              You are assuming they even do GST, they might not be at the threshold for that.

      • 

        plmko on 04/01/2024 - 10:55

        So you're going to challenge the ATO over a couple of hundred dollars which equates to maybe $50 in tax savings.

        Tough talk but I bet you'd capitulate after a few letters and phone calls.

        • 

          JimmyF on 04/01/2024 - 10:56

          @plmko:

          So you're going to challenge the ATO over a couple of hundred dollars which equates to maybe $50 in tax savings.

          Thats not what I said though ;)

• 

  Dollar General on 04/01/2024 - 12:50

  Tax is for commoners

  • 

    Aerith-Waifu on 04/01/2024 - 17:55

    Isn’t that the most of us here??? You just sum up maybe 99.99% of people here

• 

  dm02 on 04/01/2024 - 21:21

  Just so you know, you can usually ask questions of this nature at https://community.ato.gov.au/ and get a response from an ATO staff member

  • 

    Aerith-Waifu on 05/01/2024 - 00:51

    oh ok, good to know thanks many