Tax for Consultants Australia
This page is for independent consultants, advisory contractors, and service-based sole traders who want a practical starting point on ABN income, GST, BAS, PSI, home office costs, and record-keeping.
Quick answer: consultants often need to manage ABN income, invoicing, BAS, GST thresholds, working from home expenses, and the PSI rules. The biggest mistakes are treating all income like salary, missing GST registration timing, or claiming business costs without a clean private-use split.
What consultants usually need to check first
Often relevant
- ABN income, invoicing setup, and business bank-account separation
- GST registration timing and BAS reporting if turnover reaches the threshold
- PSI rules where income mainly comes from your own labour or skills
- Working from home expenses, software, phone, and internet used to earn income
- Super contributions, tax instalments, and cash-flow planning for uneven income
Common traps
- Ignoring PSI because you invoice through a company or trust without checking the rules
- Claiming meals, clothing, or mixed-use tech without a direct income link and records
- Missing GST registration or lodging BAS late once turnover increases
- Using a rough percentage for home office, phone, or vehicle costs without support
Business-structure and record-keeping checkpoints
- PSI review: service-based consulting income often needs a PSI check before income splitting assumptions are made.
- GST timing: use projected turnover, not only past turnover, when assessing registration.
- Working from home: keep invoices, diary notes, and method-specific evidence for your claim.
- Private use: software, phone, internet, and travel often need apportionment.
Start with these calculators
Sole trader tax calculator
Estimate income tax on consulting income after business deductions.
Contractor vs employee
Compare consulting income against a PAYG salary setup.
BAS calculator
Check GST and BAS cash-flow planning if you are registered.
GST calculator
Work out GST-inclusive and GST-exclusive invoice amounts.
Consultant tax FAQs
Do consultants need to register for GST?
Often yes once projected or actual turnover reaches the threshold, but timing depends on your facts.
Does PSI affect consultants?
Often yes where income is mainly a reward for your own labour or skills rather than a larger business structure.
Can consultants claim working from home expenses?
Usually yes where the cost relates to business income and you keep the records required for the method you use.
Tax Accuracy & Sources
This guide summarises common consultant tax issues only. The right answer depends on your business structure, whether PSI applies, whether GST registration is required, and how mixed-use expenses are apportioned.
Uses 2025-26 ATO rates.