Show download pdf controls
  • Business, partnership and trust income

    You must declare income you earn as an individual running a business, as a partner in a partnership or that you receive from a trust in your tax return.

    The net income you receive from carrying on a business is assessable income. Business income also includes cash and other forms of payment for goods or services you supply.

    On this page:

    Income as an individual running a business

    If you're an individual running a business (also known as a sole trader), you must declare the income you earn from your business in your own tax return. If you lodge:

    • online with myTax, this section is available when you select
      • You were a sole trader or had business income or losses, partnership or trust distributions (not from a managed fund)
      • Business/Sole trader income or loss
    • by paper, you will need to complete the business and professional items schedule.

    You don't need to lodge a separate tax return for your business.

    If you’re an artist, blogger, creative or maker you may need to work out if you have a hobby or business. You can use the Hobby or business toolExternal Link if you are getting money or intend to get money from creating things, such as:

    • jewellery
    • paintings
    • baked goods
    • blogs
    • videos.

    Income from a partnership

    Partnerships are not a separate taxable entity. A partnership carrying on a business distributes income or losses between the partners. The partnership doesn't pay tax on its income, however you must lodge a partnership tax return to declare:

    • the income the partnership earns
    • deductible expenses
    • the distribution of the net income or loss between the partners.

    Each partner in the partnership must also lodge their individual tax return to declare their share of the partnership's net income or loss. This is whether or not they actually receive the income.

    For capital gains tax (CGT) purposes, each partner:

    • owns a proportion of each CGT asset
    • 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.

    If you lodge:

    • online with myTax, this section is available when you select
      • You were a sole trader or had business income or losses, partnership or trust distributions (not from a managed fund)
      • Partnerships
    • by paper, you will need to complete the supplementary tax return.

    Income from a trust

    Like a partnership, a trust is not a separate taxable entity. The trustee must lodge a trust tax return for the trust.

    Generally, the beneficiaries of the trust declare their entitlement to the trust's income in their own tax return. Then they pay tax on it, even if they didn't actually receive the income.

    You don't however need to declare a trust distribution if family trust distribution tax has already been paid.

    If you lodge:

    • online with myTax, this section is available when you select
      • You were a sole trader or had business income or losses, partnership or trust distributions (not from a managed fund)
      • Trusts
    • by paper, you will need to complete the supplementary tax return.

    See also:

    Last modified: 01 Jun 2021QC 31934