# Make sure you claim the small business income tax offset in your tax return



## Jack Malarkey (Jan 11, 2016)

I strongly suspect that many drivers are missing out on the small business income tax offset as they’re not completing the offsets label in their tax returns.

The small business income tax offset provides a tax saving on your small business net income of up to $1,000.

The tax saving for 2020-21 is 13% (up from 8% in 2019-20). In 2021-22 and later income years, it will be 16%.

The offset has provided me with a reduction in tax of about $770 in 2020-21 so we’re not talking about chicken feed.

There’s a misconception that the Australian Taxation Office automatically allows the offset once the taxpayer returns an amount of net business income.

You need ALSO to complete the offsets label towards the end of the tax return. You don’t calculate the amount of the offset but you do need to show the amount of your net small business income.

In this calculation, don’t forget to include any jobkeeper payments you have received so as to ensure that these payments correctly benefit from the offset.

Your notice of assessment will specifically refer to the offset and the amount of reduction in tax.

If your notice of assessment says nothing about the offset, you didn’t claim it.

Perhaps check your notices of assessment for the last couple of years on myGov. If you didn’t claim it, you can request an amended assessment now to correct the oversight.

See also:









Small business income tax offset


The small business income tax offset can reduce the tax on your small business income by up to $1,000 each year.




www.ato.gov.au













Fix a mistake or amend a return


If you realise you've made a mistake or left something out of a business or super tax return, activity statement or statement, you can fix (revise) or amend it.




www.ato.gov.au


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