1 Are costs paid by you after your business ceased deductible in your 20XX and 20XX income tax return?
1 Yes. Your costs paid by you after your business ceased would be deductible as they meet the criteria in paragraph 10 of Taxation Ruling TR 2004/4 Deductions for interest incurred prior to the commencement of, or following the cessation of, relevant income earning activities . This ruling applies for the following periods : Year ended 30 June 20XX Year ending 30 June 20XX The scheme commenced on: 1 July 20XX
You ran a sole trader business (the business). The business ceased trading in April 20XX. The business' income tax return was prepared on a cash basis. Since April 20XX you have been paying the ongoing lease. You also have an outstanding balance with one remaining supplier. Both the telephone lease and supplier costs related directly to the previous business. On 30 April 20XX you owed $XX to your supplier. You paid $XX in late June 20XX and will pay the balance by 31 December 20XX. The lease was present at 30 April 20XX. It was a long-term lease and is still being paid monthly. It ceases in December 20XX.
Income Tax Assessment Act 1997 section 8-1