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anon_1234(Newbie)Newbie
7 Oct 2024

Hi,

I earn personal services income and subcontracted out some services. I can't seem to find a definition for the difference between "salary or wages and other expenses in engaging an arm's length employee or contractor (not an associate)" and "payments to associates for principal work".


I'm not sure where to add payments made to someone I contracted to. Whether this goes in in general deductions (as do all other deductions related to the PSI as I am a sole trader), or either "Deduction for payments to associates for principal work" or "Total amount of other deductions against PSI – manually calculated" in the PSI/Sole Trader section.


Thanks.




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3 replies
626 views
3 replies

Most helpful response

Most helpful reply

Deb_ATO(Community Support)Community Support
16 Oct 2024

Hi @anon_1234


You're welcome.


As a sole trader you'll still need to complete the business and professional items.


The link I provided above are instructions on how you claim the exact expense you've got.

An expense for labour and services provided under contract you made to a contractor.


It can get a little tricky. If you prefer to use the personal service income tool. We can prefill the info for you.

All replies

Deb_ATO(Community Support)Community Support
10 Oct 2024

Hi @anon_1234


It'll depend.


Were the sub-contractor payments made to a relative? Otherwise, you'd pop them straight in as a business expense.

anon_1234(Newbie)Newbie
11 Oct 2024

Thank you. I wasn't sure if associate covered friends etc or just relatives. It's a non related colleague.


I'm not sure that is the right link as I'm a sole trader not operating under a business. Do I add the subcontractor payments under "Total amount of other deductions against PSI – manually calculated" in the PSI/Sole Trader section." Or as a general deduction alongside all my other work related deductions.

Most helpful reply

Deb_ATO(Community Support)Community Support
16 Oct 2024

Hi @anon_1234


You're welcome.


As a sole trader you'll still need to complete the business and professional items.


The link I provided above are instructions on how you claim the exact expense you've got.

An expense for labour and services provided under contract you made to a contractor.


It can get a little tricky. If you prefer to use the personal service income tool. We can prefill the info for you.

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Where to enter subcontractor payments for PSI | ATO Community