When it comes to tax deductions, the Australian Tax Office (ATO) has certain criteria that must be met in order for business coaching to be considered deductible. To be fully tax-deductible, the coach must only provide advice on business matters. If the coach is a life coach, who provides advice on both business and personal matters, only the business portion of the fee will be deductible. A business coach would be deductible, and a PayPal receipt should be sufficient to prove that the amount was paid.
It is also recommended to keep a copy of the contract or agreement to prove that you are receiving the correct type of coaching. When filing your tax return, you can declare most business expenses as tax deductions in order to reduce your taxable income. The ATO has created a “cash flow training kit”, which is a free resource designed as an advisory tool for small business owners. It does not replace any existing accounting or financial tool, but can be used to complement software accounting packages. With personalized training conversations on cash flow management, the ATO kit can be particularly useful during times of financial stress. Tax professionals and business advisors can request the paper version through the ATO Publication Order Service.
For example, if you purchase business advice and consulting for your RTO, you can request a deduction for the full price of the advice. Therefore, if you are going to hire a personal or professional trainer, the ATO may not consider it a work-related expense and you may not be able to claim them as deductions.