Tax Tips for Hospitality Business Owners

The dreaded tax season is upon us again which means it is time for hospitality business owners to ensure their financial records are well-organised, including sales data, payroll, inventory costs, and vendor invoices. It’s essential to account for all sources of income, including delivery services and catering, and to reconcile point-of-sale reports with bank statements.

Deductions for expenses like equipment, utilities, and employee benefits can significantly reduce taxable income, but they must be properly documented. Staying current on payroll taxes, tip reporting, and local tax obligations is critical to avoid penalties. Consulting with a tax professional familiar with the hospitality industry can help maximise deductions and ensure compliance with all tax regulations.

Here we provide some quick tips to make the process as smooth as possible.

Get Your Records in Order Early

Start by collecting all your financial records. This includes:

• Sales and income reports from your POS system

• Invoices and receipts for purchases and expenses

• BAS and GST records

• Payroll summaries, including superannuation payments

• Bank and credit card statements

Using accounting software like Xero or MYOB makes this much easier and ensures everything is in one place.

Understand What You Can Claim

There are many deductions specific to hospitality businesses, such as:

• Equipment: Ovens, coffee machines, and fridges used for business purposes

• Stock and Supplies: Food and beverages purchased for resale

• Staff Costs: Wages, super, uniforms, and training expenses

• Utilities and Rent: Electricity, gas, water, and commercial lease payments

• Cleaning and Maintenance: Professional services to maintain health standards

• Vehicle Use: If used for deliveries or business errands

• Make sure your claims are legitimate and well-documented to avoid issues with the ATO.

Review Staff Classifications and Payroll

The ATO continues to crack down on wage underpayment and incorrect worker classification.

Ensure:

• Casual vs permanent staff are correctly classified

• Super is paid on time

• Payroll records are up to date and accurate

Single Touch Payroll (STP) reporting is mandatory, so ensure you’re compliant.

Take Advantage of Instant Asset Write-Offs

If you’ve purchased equipment or assets during the year, check if they’re eligible for instant asset write-off or temporary full expensing. This allows you to immediately deduct the full cost of eligible business assets, helping reduce your taxable income.

The instant asset write-off with a $20,000 threshold has been extended to 30 June, 2025 and applies to small businesses with an annual turnover of less than $10 million.

Look for Savings

It’s a critical time to take advantage of EOFY Sales with massive savings to be had. By reviewing expenses, stocking up on deductible supplies, upgrading kitchen equipment, or reviewing tech like your point of sale or payments before June 30, owners can reduce taxable income and set their business up for a much more efficient year ahead. It’s also a smart time to consult with an accountant to ensure all deductions are maximised and compliance requirements are met. 

Check out Impos’ EOFY Sale to trump all sales!

Get Yourself a Hospitality-Savvy Accountant

An accountant familiar with the hospitality sector can spot opportunities and ensure compliance. They can also advise on:

• Business structure (sole trader vs company)

• Tax planning strategies

• Superannuation contributions and timing

Final Tip: Start Planning for Next Year!

Tax time isn’t just about looking back – it’s a chance to plan ahead. Set quarterly financial check-ins, automate your bookkeeping, review your tech and consider POS and software integrations that reduce admin, improve accuracy and provide growth.