Claiming deductions as a sole trader with a seperate full time job as well

[#1]

My scenario is as follows. I currently work full time and as well as that job I wish to begin working as a sole trader. I am looking to purchase some equipment and tools for my new sole trader business to get set up. I believe that in the same financial year that the tools are purchased that I will not make a profit, most likely a loss. I would want to claim these tools as part of the instant asset write off. Would the deduction only apply to my income from the sole trader business or would the deduction apply to my income as an individual for the year, including my income from my full time job?

[#2 · Accepted solution]

Hi @CarlinP 

No because you will need to pass some tests to do so. I believe your trying to ask if you can claim losses against your other assessable income. If that's the case then you will need to read through the following link which will help you to understand more 

https://www.ato.gov.au/Business/Non-commercial-losses/

Hope this helps 

[#3]

Hi @Mekhael ,

Thank you. I wasn't entirely across what the implications of a tax loss were. It seems that I could use the instant asset write off to claim new equipment as a deduction, but that would cause a tax loss. But I would be able to defer that loss into future years when I am able to make a profit?

[#4]

Hi @CarlinP 

Yes you would

All the best with your business

Regards, 

[#5]

Hi @Mekhael 

Thanks so much for your help, I appreciate your time