If you are an individual taxpayer, see Individual taxpayers incurring deductible non-business expenditure.
If you are a small business entity, see Small business entities.
Non-business expenditure is any expenditure you incur in gaining assessable income from activities that do not amount to a business. For an entity carrying on a business, there may be occasions when you incur deductible non-business expenditure, for example, if you incur expenditure for a rental property held as a passive investment.
Summary of rules
- If you are not an individual or a small business entity, your deduction for prepaid non-business expenditure is apportioned over the eligible service period or 10 years, whichever is less.
- Prepaid non-business expenditure that is subject to the tax shelter rules is apportioned over the eligible service period or 10 years, whichever is less. For more information, see Investments in tax shelter arrangements.