• Business, partnership and trust income

    The net income you receive from carrying on a business is assessable income and you need to declare it on your tax return.

    Income includes cash and other forms of payment for goods or services you supply.

    Income you receive as an individual running a business

    If you're an individual running a business, you must declare the income you earn from your business on your own tax return, using a separate business schedule. You don't need to lodge a separate tax return for your business.

    If you’re an artist, creative or maker, and receiving, or plan to receive, money from creating things such as jewellery, paintings or baked goods, you can use the Hobby or Business tool on business.gov.auExternal Link to work it out.

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    Income from a partnership

    While a business partnership doesn't pay tax on its income, it must lodge a partnership tax return declaring all income earned and all deductible expenses. It will also show how the net income or loss was distributed between the partners.

    Each partner must declare their individual share of the partnership's net income or loss in their individual tax return, whether or not they actually received the income.

    For capital gains tax (CGT) purposes, each partner owns a proportion of each CGT asset and calculates a capital gain or capital loss on their share of each asset.

    The individual partners make a capital gain or capital loss from a CGT event, not the partnership itself.

    Income from a trust

    Like a partnership, a trust is not a separate taxable entity, but the trustee is required to lodge a tax return for the trust.

    Generally, the beneficiaries of the trust declare the amount of the trust's income to which they are entitled in their own tax return and pay tax on it – even if they didn't actually receive the income.

    An exception to this is, you don't need to declare a trust distribution if family trust distribution tax has already been paid.

    See also:

    Last modified: 13 Jul 2016QC 31934