Can I Claim Startup Costs for My ABN?

Yes — you can claim many startup costs for your ABN, even if they were incurred before you earned your first dollar.

Most new ABN holders spend money upfront to get ready to earn income. The tax system allows deductions for these pre-establishment expenses, provided they genuinely relate to setting up or running your business.

The rule is straightforward: if the expense was necessary to prepare your business to earn income, it’s usually deductible.

What Counts as Claimable Startup Costs

Startup costs are expenses you incur while establishing your business or preparing it to operate. Common examples include:

• Tools and equipment needed for work

• Training courses and skill development

• Software and app subscriptions

• Website setup, domains, and hosting

• Business registrations and licenses

• Initial advertising or promotional costs

These expenses can often be claimed in the year you lodge, even if income hasn’t started yet.

What the ATO Looks For

The ATO focuses on purpose and connection.

To be claimable:

• The expense must relate to earning future business income

• It must not be private or personal in nature

• You must be able to show records or receipts

If the expense was a genuine business essential rather than a personal purchase, it generally qualifies.

Why New ABN Holders Miss These Claims

Many people assume deductions only apply after income starts. That’s incorrect.

Startup costs are commonly missed because:

• Income hasn’t begun yet

• Receipts weren’t kept early

• People didn’t realise setup costs were deductible

Missing these deductions can mean losing legitimate claims or failing to record an early business loss.

How Startup Costs Affect Your Tax Outcome

Claiming startup costs can:

• Reduce taxable income once income begins

• Create a business loss that may be carried forward

• Improve cash flow in early years

Correct reporting ensures these benefits aren’t lost.

Next Steps for ABN Holders

If you’ve spent money getting your ABN ready to operate, keep the receipts and report the expenses correctly. Claiming startup costs early can make a meaningful difference to your tax result.

If you’re lodging an ABN tax return and want to claim startup costs properly, you can complete everything through GoTax here:
https://www.gotax.com.au/small-business-tax-return