Overseas business expenses

[#1]

Dear Sir/Madam,

I have an E-Commerce business, sometimes I need to pay services provided by overseas individuals or companies, for instance, my business website is regularly maintained by overseas contractors.  I pay them in their local currency if I have funds in my overseas bank account or directly pay Australian dollar from my Australian bank account to their overseas bank account. 

As overseas invoices are so different from Australian’s tax invoice, my question is for record keeping purpose what documents should I keep to legitimate claim my overseas business expenses in year end tax return. Could you advise ATO websites or regulations that related to this topic.

Thanks

[#2 · Accepted solution]

Hi @AUTPW 

International invoices should be retained the same as any Australian Invoices. The details that are relevant on an invoice are the same, barring the expectation to see an ABN or any GST amounts (GST may apply in some circumstances).

Tax invoice details can be found here

They may or may not show an australian dollar amount, that's no issue - there will be a date and foreign currency amount which can be used to calculate the AUD amount in case of an audit or other investigation. 

Any currency gains or losses should be calculated as business expenses or income and can be done automatically with some software.

For more details regarding dealing with international businesses, refer to ATO pages here