Navigating Tax Implications of Business Support Grants

In the face of recent weather challenges impacting small businesses across Australia, Simmons Livingstone understands that tax concerns might not be your top priority. However, it’s crucial to grasp the tax implications of any received business support grants.

If your business has received a grant to weather challenging times, determining whether it is assessable or non-assessable income is essential for your upcoming tax return.

While grants are typically considered assessable income, certain business support grants fall under the category of formally declared non-assessable non-exempt (NANE) income. If your grant meets specific eligibility criteria, you may exclude it from your tax return.

Discover which government grants qualify as non-assessable non-exempt, potentially relieving you from tax obligations. Notably, some natural disaster grants are classified as NANE income, provided you meet the eligibility criteria.

If you mistakenly included a NANE grant in your 2022–23 tax return, you have the option to amend it.

Keep in mind that deductions for expenses associated with NANE grants can only be claimed if they directly contribute to earning assessable income. This includes expenses like wages, rent, and utilities. However, expenses related to obtaining the grant, such as accountant fees, are not eligible for deduction.

Simmons Livingstone is here to support you during challenging times, including natural disasters. Additionally, seeking professional advice from our registered tax professionals can provide tailored insights into grants applicable to your business.

For more information, speak with your Simmons Livingstone advisor on 1800 618 800 or via email at admin@simmonslivingstone.com.au.