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Saving for Retirement as a Freelancer: A Practical Guide for 2025

Freelancers do not retire on invoices. They retire on savings. In Australia, freelancers must build that savings plan themselves. There is no employer super guarantee.

Income can change every month. This makes retirement planning easy to delay and hard to catch up on.

In 2025, the smartest approach combines super contributions, tax planning, and flexible investments. Small decisions made consistently matter more than large, irregular contributions.

Planning early reduces risk, lowers future stress, and protects your long-term lifestyle.

The Freelancer’s Retirement Challenge

Imagine this: You’re a freelancer juggling multiple clients, chasing deadlines, and suddenly you realise your retirement plan is…well, pretty much non-existent. It’s a common scenario.

Many Australians think super and retirement planning are only for full-time employees, but as a freelancer, you’re fully responsible for your future.

Retirement planning might feel complex, but it doesn’t have to be.

With the right strategies, you can secure your financial future while staying on top of your tax obligations.

Why Do Freelancers Struggle with Retirement Savings?

Freelancers often face inconsistent income, making it tempting to prioritise immediate expenses over long-term savings. Here’s why this matters:

Irregular Income Patterns

Client payments vary month to month.
Without automatic contributions, super and savings can lag.

Lack of Employer Contributions

Unlike employees, you don’t get the Super Guarantee.
You need to make voluntary contributions to super funds.

Complex Tax Considerations

Freelancers juggle GST, income tax, and potential business deductions.
Incorrect super contributions or overlooked deductions can cost you.

Pro Tax Tip: Automate super contributions monthly. Even small, consistent payments can grow substantially over time.

How Can You Start Saving for Retirement as a Freelancer?

Maximise Your Super Contributions

Freelancers can contribute to their super fund in two ways:

Concessional Contributions – Before-tax contributions, up to $27,500 in 2025, reduce your taxable income.
Non-Concessional Contributions – After-tax contributions, up to $110,000 per year, can boost savings without affecting your taxable income.

Case Study: Using Pre-Tax Super Contributions to Save on Tax

Sarah is a freelance designer earning $85,000 a year. To plan ahead for retirement, she decides to contribute $10,000 to her super before tax.

By doing this, Sarah reduces her taxable income from $85,000 to $75,000. As a result, she pays around $2,700 less in income tax (excluding the Medicare levy), while also growing her retirement savings at the same time.

This approach helps Sarah save on tax now and build a stronger financial future.

Diversify Your Retirement Savings

High-Interest Savings Account: Low-risk, accessible for emergencies.
Managed Funds or ETFs: Moderate risk, potential for higher returns.
Property Investments: Consider long-term rental income.

Pro Tax Tip: Keep clear records of all investments for easier tax reporting and potential deductions.

What Tax Benefits Can Boost Your Retirement Savings?

Freelancers have unique tax advantages:

Deductible Expenses

You can claim work-related expenses that directly contribute to your income, such as:

Home office costs (electricity, internet, rent apportioned)
Professional memberships and subscriptions
Software or hardware needed for work

Case Study: A Simple Way to Save on Tax and Grow Super

Mark is a freelance IT consultant who works from home. Over the years, he spent money on things like electricity, internet, and office equipment. By claiming $4,500 in home office expenses, he was able to lower his taxable income.

Because his taxable income was lower, Mark paid less tax. This left him with extra money that he decided to put into his superannuation.

As a result, Mark not only saved on tax now, but also increased his retirement savings for the future.

This shows how claiming the right deductions can make a real difference without being complicated.

Government Co-Contributions

If your income is below $58,445, you might be eligible for government co-contributions. This means extra money added to your super if you make after-tax contributions.

Pro Tax Tip: Review your eligibility each year via ATO’s co-contribution page.

Tax Scenarios for Freelancers

Scenario 1: The Over-Contributing Freelancer

Problem: Marc, a freelance graphic designer, claimed 100% of his phone, internet, and rent as business expenses without tracking actual usage. This put him at risk of ATO scrutiny and potential penalties.

ITP Help: Our team reviewed his records, apportioned expenses according to business versus personal use, and recalculated claims to ensure they were accurate and compliant.

Outcome: Marc avoided penalties, stayed fully compliant with ATO rules, and still saved $3,200 on his tax return. A win-win for his finances and peace of mind.

Scenario 2: The Under-Contributing Sole Trader

Problem: Rose, a sole trader consultant, was overly cautious and made minimal contributions to her super, missing out on potential tax benefits and long-term retirement growth.

ITP Help: We analysed her variable income and calculated the optimal concessional contributions she could make each year without exceeding caps.

Outcome: Rose maximised her tax savings while strategically boosting her retirement balance by $12,000 over two years, putting her back on track for a comfortable future.

Key Takeaway:

Whether you’re over-claiming or under-contributing, understanding the rules and getting expert guidance ensures you stay compliant while making the most of your hard-earned money.

Your Next Moves: Staying Smart with Tax

Keep Accurate Records

Maintain receipts, invoices, and logs.
Use accounting software to track income and expenses.

Monitor Super Contributions

Check your super fund statements regularly.
Adjust contributions based on income fluctuations.

Consult a Tax Expert

Tax laws change frequently.
A professional can help maximise deductions and contributions.

Pro Tax Tip: Schedule an annual review to ensure you’re claiming all eligible deductions and contributions.

Frequently Asked Questions

How much should a freelancer contribute to super?

Aim for at least 10–15% of your annual income, adjusting based on cash flow.

Can I claim home office costs for super contributions?

No, home office costs reduce taxable income but do not directly affect super.

What if my income varies each month?

Make flexible contributions. Some months may be higher; others lower. Consistency over time matters most.

Are there penalties for over-contributing to super?

Yes. Excess concessional or non-concessional contributions may incur additional tax.

How do I track government co-contributions?

Check eligibility and contributions via your MyGov super portal or the ATO website.

Can I invest outside super to save for retirement?

Absolutely. Diversified investments can supplement super but keep tax implications in mind.

Do freelancers pay GST on super contributions?

No. Super contributions are not subject to GST.

Want to manage your retirement savings more effectively and maximize your tax benefits?

We’ll help you understand your super options, identify smart tax-saving strategies, and create a plan that aligns with your income, goals, and lifestyle, so you can build your future with confidence while staying tax-efficient today.

Book a consultation with ITP Accounting Professionals and get tailored advice that works for your freelance business.

Understanding Tax Deductions: What Every Freelancer Should Know

Freelancers in Australia can reduce the tax they pay by claiming valid business deductions. These deductions lower your taxable income.

You must only claim expenses that directly relate to earning your income. Personal or private costs are not deductible. You must keep records to support every claim.

In 2025, the ATO continues to closely review freelancer deductions, especially home office, phone, internet, and vehicle claims.

Claiming too much or too little can both cost you money. Understanding what you can claim, and how to claim it correctly, helps you stay compliant and avoid unnecessary stress.

Why Freelancers Get Tripped Up on Deductions

If you’re freelancing in Australia, chances are you’ve asked yourself:
“Can I claim this?”

Laptop? Probably.
Coffee while working? Maybe.
That new phone you sometimes use for clients? Now it gets tricky.

Understanding tax deductions is one of the biggest challenges freelancers face, especially when you’re juggling clients, invoices, GST, and actually doing the work that earns you money. The ATO expects you to “just know” the rules, but let’s be honest: they’re not always intuitive.

What Are Tax Deductions and Why Do They Matter?

Tax deductions reduce your taxable income, which means you pay less tax overall. Simple idea, complex execution.

To be deductible under ATO rules, an expense must:

Be directly related to earning your income
Not be private or domestic in nature
Be supported by records or receipts

Pro Tax Tip: If you wouldn’t have bought it without your freelance work, it’s more likely to be deductible.

Which Tax Deductions Can Freelancers Commonly Claim?

Let’s break this into real, practical categories:

Home Office Expenses

If you work from home (and most freelancers do), you may be able to claim:

Electricity and internet (business portion)
Phone usage
Depreciation on office furniture
Rent or mortgage interest (partial, carefully calculated)

The ATO allows different calculation methods, so choosing the right one matters.

Tools, Software, and Equipment

Laptops and monitors
Adobe, Figma, Xero, MYOB subscriptions
Cloud storage and cybersecurity tools

Assets over $300 are usually depreciated over time.

Vehicle and Travel Expenses

Client meetings
Work-related site visits

Commuting from home to your usual work location is not deductible, a common ATO red flag.

Pro Tax Tip: If you’re mixing business and personal use, only claim the business percentage, and keep evidence.

How Do GST and Deductions Work Together in 2025?

If your business turnover reaches $75,000 or more, registering for Goods and Services Tax (GST) is mandatory in Australia.

This requirement applies to sole traders, partnerships, companies, and trusts once your annual sales exceed this threshold.

Failing to register on time can lead to penalties and interest charges, so it’s important to stay on top of your GST obligations.

Key GST Reminders for 2025:

GST Rate Remains 10%
The GST rate in Australia is still 10%, meaning you need to charge this on most goods and services sold. Whether you’re issuing invoices or receiving payments, including GST correctly ensures compliance and avoids issues during audits.
Claiming GST Credits on Business Purchases
Registered businesses can claim GST credits on purchases made for business use. This means that the GST you pay on office supplies, software, equipment, or other business-related expenses can be offset against the GST you collect from your sales, reducing your net GST payable. Remember, proper records and tax invoices are essential to support these claims.
BAS Lodgement: Correct and Timely
The Business Activity Statement (BAS) is how you report and pay your GST to the ATO. Lodging BAS correctly and on time is crucial to avoid penalties and interest. Whether you report quarterly or monthly, double-check your figures, reconcile GST collected and claimed, and submit before the deadline.

Tip: Even if you’re new to GST or unsure about the rules, staying organised, keeping detailed records, and understanding your obligations can save you headaches and potential fines down the track.

Real-Life Scenarios You Might Face

Scenario 1: The Over-Claiming Freelancer

Meet Jane, a talented freelance graphic designer. When it came to her tax return, she confidently claimed 100% of her phone, internet, and even home office rent as business expenses. On paper, it looked impressive, but there was a problem: she had no usage logs or proper apportionment to back up her claims. This is a common trap for freelancers who work from home; the ATO expects a reasonable allocation between personal and business use.

The ITP Solution:
Our team carefully reviewed Jane’s expenses, adjusted the claims to reflect actual business use, and applied correct apportionment calculations. We made sure every deduction was fully compliant with ATO guidelines.

The Outcome:
By fixing over-claims before submission, Jane avoided potential penalties, navigated the ATO review without stress, and ultimately saved $3,200 in taxes. She got peace of mind knowing her return was accurate and defensible.

Scenario 2: The Under-Claiming Sole Trader

Then there’s Tom, a sole trader consultant who was overly cautious with his tax return. He claimed almost nothing, fearing audits or mistakes. While this might seem safe, it actually meant he was paying far more tax than necessary, and leaving cash on the table.

The ITP Solution:
We worked with Tom to identify missed deductions, including legitimate business expenses and GST credits. We guided him on proper documentation and record-keeping, ensuring every claim was supported and compliant.

The Outcome:
The result? Tom received a $6,500 tax refund, dramatically improving his cash flow. By claiming what he was entitled to, he could reinvest in his business, reduce financial stress, and approach future tax seasons with confidence.

Key Takeaway:

Whether you’re over-claiming or under-claiming, proper guidance is crucial. Correct deductions mean more savings, fewer headaches, and a stress-free ATO review. ITP Accounting ensures freelancers and sole traders pay what’s fair, and no more.

Pro Tax Tip: Paying too much tax is just as costly as paying too little, the ATO won’t refund “voluntary overpayments” unless you claim correctly.

What About Super, Medicare Levy, and Other Obligations?

As a freelancer, you’re responsible for planning ahead.

2025 Key Figures (Australia)

Medicare Levy: 2% of taxable income for most taxpayers. Lower-income earners may be eligible for a reduction or exemption, and an additional Medicare Levy Surcharge (MLS) may apply to high-income earners without private hospital cover.
Super Guarantee: 12% (if you employ others)
Personal tax rates: Progressive, based on income thresholds

Super isn’t mandatory for sole traders, but skipping it can hurt long-term wealth.

What Records Should Freelancers Keep?

ATO record-keeping rules require:

Receipts (digital is fine)
Invoices issued and received
Bank statements
Mileage or usage logs

The ABS highlights that poor record-keeping is a major cause of small business failure.

Pro Tax Tip: If the ATO audits you, good records turn panic into paperwork.

Your Next Moves: Staying Smart with Tax

If you’re freelancing without a clear tax strategy, you’re reacting — not planning.

Smart freelancers:

Review deductions quarterly
Separate business and personal finances
Get advice before lodging, not after

Frequently Asked Questions

Can freelancers claim coffee or meals?

Only if you’re travelling away from home for work, everyday meals aren’t deductible.

Do I need to register for GST?

Yes, if turnover reaches $75,000 in any 12-month period.

Can I claim clothing?

Only protective or branded workwear, not everyday clothes.

What happens if I make a mistake?

Corrections are possible, but penalties apply for repeated or careless errors.

Is accounting software deductible?

Yes, if used for your freelance business.

Do freelancers need an accountant?

Legally no. Practically, it often pays for itself.

Ready to Get Your Freelancer Tax Sorted?

Freelancer tax deductions can quickly become confusing, especially when you’re balancing GST, home office claims, super planning, and ATO compliance all at once. Guessing or leaving it until the last minute can cost you more than you realise

Take the stress out of tax time and feel confident about your numbers. Book a consultation with an ITP Accounting Professional today and find your nearest office.

Smart Bookkeeping Tips Every Tradie and Construction Worker Should Know

Tradies and construction workers need simple, project-based bookkeeping to stay profitable and tax compliant.

Running a tradie or construction business comes with challenges beyond hammers, drills, and hard hats, and one of the biggest is bookkeeping. Many tradies enter the industry to avoid paperwork, but keeping financial records organised is essential.

Poor bookkeeping can lead to missed invoices, delayed payments, and unexpected tax bills.

By tracking costs by job, using cloud accounting to manage expenses and invoices, claiming the right tax deductions, and staying involved even when outsourcing, bookkeeping becomes manageable.

With consistent habits, you can control cash flow, reduce stress, and make tax time easier in 2025.

Why is Bookkeeping Different for Tradies?

Project-Based Work Means Complex Records

Construction and tradie work is project-driven. Each project has its own labour, materials, tools, and transport costs.

For example: A small construction business was managing multiple projects, including a bathroom renovation and a deck installation, but the owner wasn’t tracking expenses per project, leading to mixed costs for materials, labor, and tools. As a result, it was difficult to assess the profitability of each job. To solve this, the owner assigned unique project codes to each job and recorded all costs under those codes. This allowed for clear tracking of income and expenses per project. By doing so, the business was able to identify which projects were profitable and which required cost adjustments, leading to better pricing decisions and improved cash flow.

How to manage it:

Assign a unique project code or name for every job.
Track labour hours per worker and material costs by project.
Keep digital copies of all supplier invoices.
Generate project profitability reports to understand which jobs deliver the best returns.

Delays Are Normal (Plan for Them)

Delays happen frequently, from weather disruptions to material shortages or client changes. Accurate bookkeeping ensures you have visibility on cash flow and pending invoices during these periods.

Practical tip: Use cloud accounting software to set reminders for invoices and payment deadlines so you can stay in control even when projects run behind schedule.

Should You Outsource Your Bookkeeping?

The Benefits of a Bookkeeper

A qualified bookkeeper is more than a data-entry expert, they’re a business partner. They can:

Prepare weekly or monthly financial reports
Identify patterns in spending or project costs
Ensure GST, BAS, and super obligations are met
Alert you to cash flow issues before they become urgent

For instance, a bookkeeper can advise whether a $15,000 tool purchase should be written off under the instant asset write-off or depreciated over several years to maximise tax efficiency.

Staying Involved

Even with outsourcing, you must remain engaged:

Review reports regularly
Discuss unusual costs or spending spikes
Make decisions on hiring, equipment purchases, or project pricing

A bookkeeper is an extension of your team, helping you make informed business decisions.

Why Cloud-Based Accounting Matters

Digital Records Are Safer and Easier

Paper receipts in your ute or toolbox can get lost. Cloud accounting allows you to:

Snap photos of receipts via phone and upload instantly
Categorise expenses by project
Access records from anywhere

ATO rules in 2025 allow digital copies of receipts and invoices as long as they’re true and clear copies. Cloud storage also reduces stress at tax time and simplifies BAS preparation.

Choosing the Right Software

Look for accounting software that:

Offers multi-user access
Integrates with your bank for automatic transaction imports
Handles payroll, super, and BAS

Pro Tax Tip: Flag expenses for deductions at entry, fuel for work vehicles or protective clothing can be coded immediately.

Tax Deductions for Tradies

Common Deductible Expenses in 2025

Work Vehicle Expenses: Maintain a logbook to record business use and keep receipts for fuel, insurance, and servicing.
Travel Costs: Claim accommodation, meals, flights, tolls, and parking for work trips.
Home Office Expenses: Include phone, internet, electricity, heating, and office furniture.
Work Clothing: High-vis jackets, steel-capped boots, and other protective gear.
Training and Licensing: OH&S courses, skill upgrades, and trade certifications.
Tools and Equipment: Instant asset write-off allows full deduction for items under $20,000. Larger assets may be depreciated.

Pro Tax Tip: Only claim expenses already incurred and business-related. Private items are not deductible.

Managing tax deductions is one part of keeping your business finances healthy, but sometimes you need cash flow right away to cover tools, equipment, or unexpected project costs.

ITP Accounting Professionals can help tradies access fast funds so you can keep jobs moving without delays.

How to Keep Your Bookkeeping Consistent

Building habits takes time. Studies show 66 days on average to make a new behaviour automatic. Make bookkeeping part of your routine:

Daily: Record all invoices and receipts immediately.
Weekly: Reconcile bank transactions.
Monthly: Review project costs, profit margins, and overdue invoices.

Consistency reduces errors, gives clear insights into profitability, and makes tax time stress-free.

Cash Flow Management Tips for Tradies

Cash flow is the lifeblood of any tradie business. Poor cash flow can lead to late payments, staff issues, or even missed supplier invoices.

Tips to manage cash flow effectively:

Invoice promptly: Send invoices as soon as work is completed.
Offer payment plans: For large jobs, consider staged payments to balance incoming cash.
Monitor outstanding invoices: Follow up regularly to avoid overdue accounts.
Set aside a cash buffer: Maintain at least 10–15% of monthly expenses in a separate account for emergencies.
Forecast ahead: Estimate income and expenses for upcoming projects to avoid shortfalls.

Proper cash flow management ensures your business can handle delays, unexpected costs, and seasonal fluctuations.

Common ATO Mistakes and How to Avoid Them

Even experienced tradies can make mistakes with the ATO. Common pitfalls include:

Mixing personal and business expenses: Always use separate bank accounts.
Incorrectly claiming deductions: Only claim items directly related to your trade.
Failure to maintain proper documentation: Missing invoices or receipts can lead to denied claims.
Late lodgements: Avoid penalties by lodging BAS and tax returns on time.

Pro Tax Tip: Keep digital backups of all receipts and invoices, and reconcile monthly. A small habit now saves headaches later.

Step-by-Step Project-Based Bookkeeping Workflow

Here’s how to manage finances for a construction project efficiently:

Set up the project: Assign a unique project code in your accounting software.
Record every expense: Labour, materials, tools, transport, tag each to the project.
Issue invoices promptly: Track client payments and follow up overdue accounts.
Reconcile weekly: Compare bank transactions to recorded expenses and income.
Review monthly: Analyse profit margins per project and adjust pricing or costs if needed.
End-of-year reporting: Summarise all projects to calculate tax deductions, depreciation, and profitability.

Following this workflow ensures you stay organised, maximise tax efficiency, and maintain a clear view of project performance.

Tools and Technology That Make Life Easier

Xero, MYOB, QuickBooks: Manage invoices, GST, payroll, and BAS.
Receipt scanning apps: Automatically digitise and categorise receipts.
Project management software: Link costs and income to individual jobs.
Banking integrations: Import transactions automatically, reducing manual errors.

These tools, combined with a reliable bookkeeper, save hours each week and give you more time on-site doing what you do best.

Take Control of Your Finances: Make Bookkeeping Work for You

Bookkeeping doesn’t have to be overwhelming for tradies and construction workers.

By tracking project costs, using cloud-based software, understanding tax deductions, managing cash flow, and following a structured workflow, you’ll gain control over your finances and even improve profitability.

At ITP Accounting Professionals, we provide tailored bookkeeping services to suit your schedule, whether you need support one day a week or full-time. Our tax agents ensure compliance and help you maximise your tax refunds.

Have You Made Your 2026 New Year’s Financial Resolutions?

The new year is a chance to refresh, not just on your diet or gym routine, but on your finances too.

Have you set your 2026 New Year’s financial resolutions?

Smart financial goals can save you money, reduce stress, and support long-term success. Whether you’re building an emergency fund, maximising tax deductions, or planning for retirement, acting early makes a real difference.

With higher living costs and tighter lending rules in 2026, financial planning matters more than ever. Clear resolutions help you control spending, reduce tax, and build long-term security. These goals don’t need to be complex.

Simple steps, taken early and reviewed regularly, create meaningful progress. Whether your focus is saving more, improving your credit, or managing a side hustle, a clear plan turns intention into results.

Let’s explore practical, achievable resolutions for 2026,and how to stick to them.

How Can You Save More Money in 2026?

Saving money is at the top of most people’s financial resolutions. Here’s how to turn your good intentions into real results.

Pay Down High-Interest Debt

Credit cards and personal loans can carry interest rates of 15%–20% or more. Focus on clearing high-interest balances first. The less interest you pay, the faster your savings grow. For example, if you owe $5,000 on a 20% credit card, paying it off in 12 months saves over $500 in interest.

Cut Back on Discretionary Spending

Small changes add up. Consider reducing dining out, subscription services, or luxury shopping. Even saving $50 a week can net $2,600 a year.

Live Below Your Means

Resist lifestyle inflation as your income grows. Continue living like you did on a lower salary and redirect extra cash to savings or investments.

Refinance Loans

If mortgage or personal loan rates are above current market rates, refinancing could save thousands over the life of the loan. Check with your lender or a financial advisor before making any changes.

Review Insurance Policies

Compare home, car, and health insurance regularly. Switching to a better deal or adjusting coverage can reduce premiums without sacrificing protection.

Pro Tax Tip: Combine insurance and investment reviews with your annual tax planning to maximise deductions. Learn more about ITP Tax Services.

How Can You Improve Your Credit Score?

A good credit score reduces borrowing costs and improves financial flexibility.

Pay Bills On Time

Payment history is the biggest factor in your credit score. Use automatic payments for loans, utilities, and credit cards to avoid late fees.

Check Your Credit Reports

Request your free annual credit reports from Equifax, Experian, and illion. Dispute errors immediately, mistakes can drag your score down unnecessarily.

Space Out Applications

Applying for multiple credit accounts in a short period triggers hard inquiries, temporarily lowering your score. Only apply when necessary.

Be Patient

Improving credit takes time. Consistently pay bills on time, reduce debt, and monitor reports over 6–12 months for noticeable improvement.

How Can You Organise Your Side Hustle for Tax Efficiency?

Many Australians start side hustles to earn extra income. Without careful planning, extra cash can also mean higher tax.

Register Your Business

If you earn money through a side hustle, register as a sole trader with the ATO. This allows you to claim deductions for work-related expenses, reducing taxable income.

Keep Detailed Records

Track all expenses: materials, equipment, travel, internet, phone bills, etc. Receipts are essential to substantiate claims.

Choose the Right Structure

An accountant can advise if a sole trader, company, or trust is best for your long-term goals. The right structure maximises deductions and minimises tax.

Consider Super Contributions

Salary sacrificing extra super from your side hustle can reduce taxable income. In 2026, concessional contributions are capped at $27,500 per financial year.

Pay Yourself a Wage

Paying yourself a regular wage instead of withdrawing all profits helps smooth cash flow and creates deductions for your business.

We can help you set realistic financial goals, track progress, and adjust plans as life changes. Book a consultation and turn your resolutions into results with professional support.

Am I Earning Personal Services Income (PSI)?

Personal Services Income (PSI) is money earned primarily from your skills and effort rather than from a business or asset. If more than 50% of your income comes from your labour, PSI rules may apply.

Why It Matters

PSI rules determine how income is reported to the ATO and which deductions are allowed. Misclassification can result in incorrect tax reporting.

How to Check

Examine your contracts and income sources. If your earnings depend mainly on your personal effort, consult an accountant to confirm PSI status.

Pro Tax Tip: Correctly classifying your income ensures you claim all legitimate deductions and avoid penalties. Contact an ITP Tax Accountant.

How Can You Plan to Pay Less Tax in 2026?

Everyone wants to pay less tax, but fewer people plan for it proactively. Year-round strategies make a real difference.

Super Contributions

Making concessional contributions up to $27,500 can reduce taxable income, with contributions taxed at just 15%, lower than most marginal rates.

Claim Work-Related Deductions

Keep records of work-related expenses, donations, interest payments, and investment costs. Also, check eligibility for low- and middle-income tax offsets.

Salary Sacrifice Benefits

Sacrifice pays for super, laptops, or phone expenses. This reduces taxable income dollar-for-dollar.

Long-Term Investments

Assets held over 12 months enjoy a 50% capital gains discount. Investing in shares, property, or your business creates tax-effective wealth growth.

Structure Your Small Business Properly

Companies and trusts provide more deduction opportunities and flexibility. Get professional advice on income splitting, salary vs dividend payments, and tax minimisation strategies.

Stay on Top of Record Keeping

Receipts, invoices, and records support deductions and allow amendments if something was missed. Digital apps make tracking simple.

ITP specialists can help structure your side business, track expenses, and identify deductions to reduce your tax bill. Get personalised advice today.

How Do You Stick to Your Financial Resolutions?

Financial resolutions are goals, and like all goals, they need a plan.

Set Specific, Measurable Targets

Instead of vague goals, try “save $200 per month” or “pay off $3,000 of credit card debt by June 2026.” Clear targets are easier to track.

Create a Monthly Budget

Budgeting income, expenses, and savings helps monitor progress and adjust when necessary.

Automate Savings

Set up automatic transfers to savings or investment accounts each payday, this is “paying yourself first.”

Track Spending

Use apps or a simple spreadsheet to see where your money goes. Awareness is the first step toward control.

Celebrate Milestones

Reward small wins to maintain motivation. Each step forward is progress.

Find an Accountability Partner

A friend, family member, or financial advisor can provide encouragement and advice.

Adjust When Life Changes

Income or expense changes may require modifications to goals, but don’t abandon them. Staying consistent is key.

Get Expert Help to Make 2026 Your Best Financial Year

Starting 2026 with clear financial resolutions gives you control, confidence, and a roadmap for the year ahead.

From saving more to paying less tax, improving credit, and planning your side hustle, small, consistent steps lead to big results.

If you want guidance tailored to your situation, an ITP Tax Accountant can help turn resolutions into achievable goals. Don’t leave your financial future to chance, start planning today.

Disclaimer: This blog is for general information only and does not constitute financial or tax advice. For advice specific to your circumstances, please consult a qualified accountant or financial advisor.

Unlock Savings: 6 Key Tax Deductions Every Construction Worker and Tradie Should Know

If you’re a construction worker or tradie, your job comes with more than physical work. It comes with real expenses. Vehicles, tools, safety gear, training, and after-hours admin all cost money.

In Australia, many of these costs are tax-deductible when they directly relate to your work. Claiming the right deductions reduces your taxable income and can increase your refund.

Claiming the wrong expenses can attract ATO attention.

In 2025, tradies must keep clear records and follow specific rules for vehicles, work clothing, equipment, and home office use. Knowing what you can claim, and how to claim it correctly, helps you stay compliant and keep more of what you earn.

1. Drive Down Your Tax: Motor Vehicle Expenses Tradies Can Claim

For most tradies, a vehicle is essential for getting to jobs, picking up supplies, and meeting clients. The ATO allows you to claim car expenses that relate directly to earning your income, but there are rules to follow.

Tracking with the Logbook Method

Using a logbook is the most accurate way to claim motor vehicle expenses. You track your car usage for 12 continuous weeks, noting kilometres travelled for work versus personal trips. The percentage of work travel is then applied to expenses such as fuel, insurance, registration, and maintenance. Logbooks remain valid for up to five years if kept properly.

Claiming via the Cents-per-Kilometre Method

Alternatively, you can use the cents-per-kilometre method, claiming up to 5,000 business kilometres per car per year. For 2025, the ATO rate is 78 cents per kilometre. This method is simpler, but you must calculate kilometres reasonably and keep a diary or notes to back your claim

Learn more about vehicle deductions on the ATO website.

Pro Tax Tip: Parking fees and tolls can also be claimed if they’re for work-related travel and you’ve already paid them yourself.

2. Gear Up for Deductions: Work Clothing and Protective Equipment

Safety is a must on every site, and the ATO allows you to claim work-related clothing and protective gear. Only items required for your job can be claimed, no casual jeans or street shoes.

Eligible Items Include:

Compulsory uniforms with a company logo
High-visibility clothing, overalls, heavy-duty work shirts and pants
Steel-capped boots, gloves, safety glasses
Fire-resistant clothing
Sun protection and sunscreen

You can also claim the cost of laundering, repairing, or replacing these items if they are directly related to work.

Pro Tax Tip: Keep receipts and label all clothing clearly if it’s a uniform, as this will make substantiating claims easier during an audit.

3. Level Up Your Skills and Your Tax Return: Training and Education Costs

If you’re upgrading your skills or attending work-related courses, the costs can often be claimed. The ATO allows deductions for self-education directly related to your current job.

What You Can Claim:

Course fees, seminars, workshops, and conferences
Textbooks, stationery, and online resources
Internet access and computers used for study
Travel and accommodation if the training is away from your usual workplace

Important: You can only claim courses related to your current income.

Case Study: Claiming Work-Related Training

James is a licensed plumber who wants to stay up to date with industry standards. He enrols in an advanced plumbing course to improve his skills and efficiency on the job. Because the course directly relates to his current work, James can claim the full cost as a tax deduction.

On the other hand, if James decided to take a course in electrical work to switch careers, this expense would not be deductible, as it doesn’t relate to his current income-earning role.

Pro Tax Tip: Keep all receipts and invoices, these make claiming straightforward and reduce the risk of an audit.

4. Home Base, Big Savings: Claiming Home Office Expenses as a Tradie

Even if most of your work is on-site, you might have a home office or study. You can claim a portion of your running costs if you use it for work.

Fixed-Rate Method

For 2025, the ATO allows $0.52 per hour for heating, cooling, lighting, and depreciation of furniture. This is simple and doesn’t require detailed calculations.

Actual Expense Method

Alternatively, you can claim a proportion of actual expenses such as:

Mortgage interest or rent
Council rates, land tax, house insurance
Internet, phone, stationery, and office equipment

The key is apportioning business vs private use accurately. If clients visit your home office, you can also claim a percentage of occupancy costs.

Pro Tax Tip: Keep a diary or spreadsheet to record hours spent working from home to make apportionment easier.

5. Tools of the Trade: Equipment Costs You Can Deduct

Tools and equipment are essential for construction workers and tradies. If you own your tools, you can claim the costs as a tax deduction.

Eligible Expenses Include:

Purchasing tools and equipment
Repairs and maintenance
Insurance on tools
Interest on money borrowed to buy tools
Computers, tablets, and smartphones used for work

Immediate deduction vs depreciation:

Items under $300 can be claimed immediately
Items over $300 must be depreciated over their effective life

Pro Tax Tip: If a tool is used both for work and personal use, only claim the work-related portion.

6. Extra Wins: Other Work-Related Expenses That Can Reduce Your Tax

Beyond the obvious costs, there are other deductions tradies shouldn’t overlook:

Union fees and professional memberships
Industry journals, periodicals, and trade magazines
License renewals (but not the initial license cost)

Keeping all receipts, bills, and bank statements ensures you can substantiate your claims.

Pro Tax Tip: Speak to your tax agent, they can help you identify every eligible deduction and guide you on record-keeping. Contact ITP Accounting Professionals for expert advice.

Frequently Asked Questions

Can I claim my mobile phone and internet?

Yes, if used for work purposes. Only the business-use portion can be claimed, and you must keep a record of work-related usage.

What if I use my car for both work and personal travel?

Only claim the work-related percentage. Using a logbook or kilometre diary helps you calculate this accurately.

Can I claim meals while on the job?

Meals can generally only be claimed when travelling overnight for work. Daily lunches at your usual workplace are not deductible.

Ready to save on tax this year?

Claiming the right tax deductions can save you thousands each year and make running your trade more affordable. From motor vehicle costs and protective gear to training, home office expenses, and tools, every deduction counts.

Working with ITP Accounting Professionals ensures you claim everything you’re entitled to while staying compliant with the ATO. Our experts provide personalised advice for construction workers and tradies across Australia, helping you maximise your tax return and keep your finances in check.

Study & Training Loans: HELP, VSL, AASL Repayment Guide 2025

Quick Summary:

Learn the repayment obligations for HELP, VSL, and AASL loans.
Understand income thresholds, repayment rates, and methods.
Explore real-life scenarios with 2025 figures.
Pro Tax Tips to manage your debt efficiently.

The Reality of Student Loans

Managing student loans can feel like juggling flaming torches while riding a unicycle, exciting, but stressful. Whether you’re a student, professional, or business owner, understanding how HELP (Higher Education Loan Program), VSL (Veterans’ Study Loan), and AASL (Austudy Assistance Student Loan) repayments work in 2025 is crucial. Miss a step, and you could face unnecessary interest or delayed progress toward financial freedom.

This guide breaks down your obligations, repayment strategies, and practical examples to help you tackle your student loan confidently.

How Do HELP, VSL, and AASL Loans Work?

HELP, VSL, and AASL are Australian government-backed student loans that allow you to defer tuition payments until your income reaches a certain threshold. These loans are designed to make education accessible without upfront financial stress.

HELP: Higher Education Loan Program

HELP is the most common government study loan in Australia and is designed specifically for university and higher education students. It covers eligible tuition fees so students can study now and repay later through the tax system.

This includes programs such as:

HECS-HELP for Commonwealth-supported university students
FEE-HELP for full-fee-paying students
OS-HELP for students studying part of their course overseas

HELP allows students to focus on completing their degree without needing to pay upfront, making higher education more accessible and financially manageable.

VSL: Veterans’ Study Loan

The Veterans’ Study Loan (VSL) is tailored for former or current defence personnel who want to continue their education after service. It helps veterans transition into new careers by covering approved vocational education and training (VET) courses.

Key benefits include:

Support for nationally recognised qualifications
Flexible learning options for career change or upskilling
Structured repayment through the tax system once income reaches the threshold

VSL is particularly valuable for veterans wanting a smooth transition into civilian employment or further professional development.

AASL: Austudy / Youth Allowance Student Loan

The AASL provides additional financial support to students receiving Austudy or Youth Allowance who need help covering education-related expenses.

It assists eligible full-time students who may struggle with upfront costs such as:

Course materials
Equipment
Study resources
Other approved education expenses

Because AASL is added to your overall study loan balance, repayments are made through the ATO once your income exceeds the annual threshold. It acts as a safety net for students who need extra support beyond living allowances.

Key Features:

Loan balances are indexed annually to reflect inflation.
Repayments are income-contingent.
No traditional interest; indexation is applied instead.
Managed through the Australian Taxation Office (ATO).

Need help understanding these rules? Visit ITP Accounting Professionals, Australia’s trusted tax experts.

Who Needs to Repay and When?

Income Thresholds in 2025

Your repayment obligation starts once your income exceeds $52,973 (2025 threshold for HELP/VSL/AASL). Repayment rates vary depending on your income:

1%: $52,973 – $60,000
2%: $60,001 – $65,000
2.5%: $65,001 – $70,000
3%: $70,001 – $75,000
3.5%: $75,001 – $80,000
4%: $80,001 – $85,000
4.5%: $85,001 – $90,000
5%: $90,001 – $95,000
5.5%: $95,001 – $100,000
6%: $100,001+

Reporting Your Income

Repayments are collected through the tax system, so it’s essential to report your income accurately on your annual tax return. Your employer will withhold HELP repayments automatically if you’ve opted in via your tax file number.

Pro Tax Tip: A registered tax agent like ITP Accounting Professionals can help ensure your income reporting and loan deductions are accurate.

How Are Repayments Calculated?

Using Real Numbers

Imagine your taxable income in 2025 is $75,000:

Income above the threshold: $75,000 – $52,973 = $22,027
Repayment rate: 3.5%
Annual repayment: 3.5% of $75,000 = $2,625

If you are employed, this amount is deducted via PAYG withholding. If self-employed, you’ll need to pay via your tax return.

Multiple Loans

If you have both HELP and VSL debts, repayments are combined into one total debt. The same income threshold applies, simplifying your repayment calculation.

Can You Repay Voluntarily?

Yes. Making voluntary repayments can save you time and prevent debt growth due to annual indexation.

Benefits:

Reduce long-term indexation costs
Decrease the total repayment period
Improve credit standing

How: Through myGov, online banking, or ATO payment options.

Pro Tax Tip: Even small voluntary payments help. Consider rounding up your monthly PAYG withholding to pay extra.

Real-World Loan Repayment Scenarios (So You Can See How It Actually Works)

Understanding percentages and thresholds is useful — but seeing how repayments work in real life is even better. Here are three practical scenarios showing what HELP, VSL, and AASL repayment obligations look like in 2025.

HELP Loan
Scenario 1: The Early Career Graduate Starting Out Strong

Loan Balance: $25,000
Salary (2025): $55,000
Repayment Rate: 1%
Annual Repayment: $550

Emily has just landed her first full-time job as a junior marketing coordinator. Her salary puts her just above the 2025 minimum repayment threshold of $52,973.

At a 1% repayment rate, her annual HELP repayment is fairly small — only $550 for the year, deducted gradually through her employer’s PAYG withholding.

This means Emily can start paying down her loan without feeling financial pressure, while still building her career and savings.

Pro Tip: Small voluntary payments (even $20–$50 a month) can help reduce indexation and shorten your repayment timeline.

VSL Loan
Scenario 2: The Mid-Career Professional With a Higher Income

Loan Balance: $40,000
Salary (2025): $95,000
Repayment Rate: 5.5%
Annual Repayment: $5,225

Michael used a Veterans’ Study Loan (VSL) to upskill after leaving the defence force. Now working in project management, his income of $95,000 places him in the 5.5% repayment bracket.

At this level, his compulsory annual repayment is $5,225, automatically withheld through his employer.

The higher income means higher repayments, but also faster progress. Michael could clear his VSL balance within a few years if his earnings continue to rise.

Pro Tip: Higher-income earners benefit the most from voluntary repayments because they minimise indexation on large balances.

HELP and AASL Loan
Scenario 3: The Part-Time Worker Managing Multiple

Total Loan Balance: $25,000 (HELP: $15,000 & AASL: $10,000)
Salary (2025): $60,000
Repayment Rate: 2%
Annual Repayment: $1,200

Chloe works part-time while completing further training. She has both HELP and AASL debts, which the ATO treats as one combined balance.

With a 2025 salary of $60,000, she sits in the 2% repayment bracket. This means her compulsory annual repayment is $1,200, applied against her total loan.

Even though Chloe works reduced hours, her repayments remain manageable — and because her income fluctuates, her repayments will rise or fall accordingly.

Pro Tip: Always check your myGov loan balance yearly. Multiple small loans often get forgotten, and indexation can sneak up if you’re not monitoring it.

What Happens if You Don’t Repay?

Failing to report or repay when required can lead to:

Increased loan balance due to indexation
Compounded repayment difficulties
Potential penalties or interest in rare cases

Pro Tax Tip: Even if your income fluctuates, staying proactive and checking your myGov account regularly can prevent unpleasant surprises.

Your Next Moves: Staying Smart with Your Loans

Know your thresholds – Keep updated on 2025 income levels.
Report accurately – Your tax return drives repayments.
Consider voluntary repayments – Every bit helps reduce long-term debt.
Use official tools – ATO calculators and myGov make planning easy.
Seek professional advice – Tax agents can save you time and money.

By taking these steps, you’re in control of your loan, not the other way around.

FAQs

Can I defer repayments if I’m unemployed?

Yes. If your income falls below the threshold, you are not required to make repayments.

Are HELP/VSL/AASL loans interest-free?

Yes. They are indexed annually to keep pace with inflation, but traditional interest does not apply.

Can international students access HELP?

No. HELP loans are generally available to Australian citizens and eligible permanent residents.

Do voluntary repayments reduce indexation?

Yes. Paying off part of your debt early reduces the total loan balance, limiting the impact of annual indexation.

How can I track my repayment progress?

Log into myGov and check the ATO section for real-time loan balance and repayment history.

Ready to Take Control of Your Study Loan?

Managing HELP, VSL, or AASL debt doesn’t have to feel overwhelming. Whether you’re just starting your career, juggling multiple loans, or preparing for a major financial milestone, the right advice can save you time, stress, and unnecessary costs.

At ITP Accounting Professionals, our tax experts help you:

Understand your repayment obligations for 2025 and beyond
Avoid common mistakes that lead to overpayments
Plan voluntary repayments strategically to reduce indexation
Make informed decisions that support your long-term financial goals
Lodge your tax return accurately and confidently

Your student loan is just one part of your financial journey — and you don’t have to navigate it alone.

Book an appointment with your nearest ITP Accounting Professionals office today to get personalised guidance and start managing your loan with clarity and confidence.

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