Can a director be a contractor to his own company?

 Author: Bruce4Tax(Taxicorn)Taxicorn

29 Aug 2021

I searched for this, but didn't find any definitive answer. I suspect there exists such a provision in the tax law that prohibts a sole director and shareholder to invoice his/her own company. One thing I came across is the term 'deemed' i.e. the director is a deemed employee. I mean - Is one-size fit-all is the approach of ato in this case or it can be considered on a case by case basis.

Nothing to stop a director doing this, except that director would likely be making a false declaration to get an ABN.

Cannot see that there is really a business if the only customer is your own company.

Workcover and super would still need to be paid.

Also what if the director passes the result test. Would it make a difference?

Only that the income would then not be PSI.