What is Income ?

Income (Definition)

Income refers to the money a business makes by selling its goods or services, or that an individual makes in return for work, services, or investments. If you run a coffee cart and you sell 10 coffees for $5 each, your income is $50. Income for accounting purposes indicates the amount of tax you need to pay to the government and is calculated by comparing assessable income with deductions. For example, your assessable income includes gross income – that is any earnings the business makes from everyday business activities (sales and services) and other sources, such as capital gains. Deductions are what your business can claim as expenses, such as rent, supplies, etc. The income of a business can be either positive or negative in any fiscal year, depending on the company's spending and losses.


End of financial year checklist

The end of the financial year is an important time of the year when businesses need to ensure they have submitted all necessary reporting requirements to the ATO. Use our end of financial year checklist to stay organised and prepared for tax time.

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