The ATO has advised that, while most small businesses ‘do the right thing’, it still sees some sole traders do the following:

• Omitting income such as salary or wages earned outside of their business, including non-monetary payments or payments in kind
• Incorrectly claiming expenses (e.g., claiming for the portion of an expense related to personal use or overstating the cost of goods sold and other business expenses)
• Incorrectly calculating business losses
• Incorrectly applying non-commercial loss rules to offset the loss against other income
• Incorrectly claiming PAYG withholding refunds
• Incorrectly reporting or failing to report personal services income

To avoid making these mistakes, the ATO’s Small Business Tax Time Toolkit contains the following information to help small businesses get it right:

• A helpful directory of links to help you find information, tools, calculators, learning resources and other support and services
• Several fact sheets