Tax issues for businesses that have received a support payment

November 2, 2023 | Luke Wade

Taxpayers who have received a government support grant or payment recently to help their business recover from COVID-19 or a natural disaster should check if they need to include the payment in their assessable income.

Grants are generally treated as assessable income, and taxpayers may be able to claim deductions if they use these payments to:

However, some grants are declared non-assessable, non-exempt (‘NANE’) income.  This means taxpayers don’t need to include them in their tax return if they meet certain eligibility requirements.

NANE grants include but are not limited to:

Taxpayers can only claim deductions for expenses associated with NANE grants if they relate directly to earning their assessable income, including wages, dividends, interest and rent.

Taxpayers cannot claim expenses related to obtaining the grant, such as accountant’s fees.