And don't you have to prove they're losing value? What do you compare them to? Sales at kmart?
________
HAWAII MEDICAL MARIJUANA
Last edited by MV75; 11th March 2011 at 09:30 AM.
if they can give druggies a legal place to shoot up then surely Jossier Jaydisc can get some tax back
i am not 100% sure but i remember reading that u can claim deduct eductional expenses for your children on your personal income tax form
Wanted items:
eHobby Orion Pax and Dion
For shame on Dirge for not remembering where I work ...
I don't have the fancy papers, but i've worked for an Accountant for 11 years. So here's the deal.
Your "stock" won't be a straight up deduction. As you still have it "on hand" you have to put it in as "closing stock". Basically it's Sales - Purchases + Closing Stock.
So if you sold $1000 worth, bought $4000 worth, your closing stock is essentially $3000. That's at the cost price level. You can also use the market value, ie, what you intend to sell the remainder for which may be $5000.
However all that may be pointless depending on your other income.
If you were on wages and earning more than $40,000 you wouldn't be able to claim any losses unless your sales were over $20,000.
However as you're a sole trader that won't be an issue as at the end of the day, all business related income and expenses are lumped together.
In other words, you could have seperate Profit and Loss statements for your software business and collecting business, but once you do the tax return they're combined.
At the end of the day though IF you were to be audited I would imagine the ATO would take one look and regard it as nothing more than a hobby and disallow it.
Your Accountant however may see things differently so any advice I give here may be different to what they offer. Neither is right, neither is wrong, it all comes down to how well you cover it up so the ATO doesn't see it.