Tax Time Tips for Instructors
Last updated 16 Jul 2025
Actionable accounting and tax tips for the 2026 financial year
As the new financial year kicks off, staying ahead of your tax and accounting obligations is essential for running a strong, compliant business. Here are the key dates, tips, and deductions every instructor should know.
🗓 Key Compliance Dates to Mark in Your Calendar
| Date | Task | Tip |
|---|---|---|
| 14 Aug 2025 | PAYG instalment notice due | If your income is tracking lower this year, consider varying down your instalments. |
| 31 Oct 2025 | Lodge individual tax return (self-prepared) | Using an agent extends the due date as far as May 2026. |
💡 Things to Know For FY26
Instant asset write off may be extended
The government has proposed to extend the $20,000 instant asset write off to 30 June 2026, meaning you may be able to fully deduct the cost of qualifying assets — like a car or technology — in the year you buy them.
Important: This extension is not yet confirmed, so check with your accountant before buying big-ticket items.
🏁 Maximise Deductions, Minimise Hassle: Common Deductions Cheat Sheet
Keeping track of what you can claim at tax time doesn’t have to be complicated. The key is knowing what counts as a legitimate business expense and having the right evidence ready. Below is a handy cheat sheet of the most common deductions for driving instructors — plus the proof you’ll need to keep your claims stress-free and audit-ready.
| Category | What you can claim | Evidence to keep |
|---|---|---|
| Vehicle running costs | Fuel, servicing, tyres, insurance, registration business share | Ninety day log book, odometer readings, receipts |
| Vehicle depreciation | Decline in value of the car based on business kilometres | Purchase invoice, finance contract, log book |
| Technology | Phone, tablet, dash cam, laptop, GPS device used for work | Tax invoices, usage diary if mixed use |
| Home office | Portion of electricity, rent, internet, cleaning | Four week activity diary under fixed rate or all worked hours under the actual cost method |
| Professional fees | ASIC charges, association memberships, accountant fees | Invoices and payment records |
| Education and CPD | Driving instructor refresher courses, first aid refreshers | Course receipt and completion certificate |
| Advertising and marketing | Google Ads, Facebook boosts, printed flyers, car signage | Platform invoices, design receipts, photos of signage |
| EzLicence Service Fee | Service Fees on Bookings, Payout Processing Fees, Monthly Account Fee | Copies of tax invoices available in your EzLicence account |
| Bank and merchant fees | Stripe, Square or bank transaction charges tied to lessons | Monthly statements and reconciliation reports |
| Public liability and professional indemnity insurance | Premiums that protect you and your students | Policy schedule and payment confirmation |
| Interest on business vehicle loan | Interest portion of instalments where car is used for work | Finance amortisation schedule, log book |
| Lease or hire payments for vehicles or equipment | Van lease, short term hire of dual-control vehicle | Lease agreements, monthly statements |
| Road tolls and parking | Toll tags, council parking for lessons, airport pick ups | Toll statements, parking receipts annotated as business |
| Software subscriptions | Xero or QuickBooks, mileage trackers, lesson scheduling apps | Subscription invoices and bank statements |
| Consumables and small supplies | Sanitiser, wipes, stationery, clipboards, learner log books supplied to students | Store receipts grouped by month |
| Mobile data and call costs | Business share of phone plan used for student calls and navigation apps | Phone bills marked with business call highlights |
| Health and wellbeing expenses linked to work safety | Annual eye test if required for driving, flu shot, ergonomic seat cushion | Doctor or pharmacy receipts plus a note on business relevance |
✅ Tip: Store scanned copies of all receipts in a cloud folder named by financial year so your accountant can verify claims quickly.
📲 Tech Toolbox: Make Tracking Easy With Mileage and Receipt Apps
Staying on top of mileage and receipts is easy with the right tools that can help you keep accurate records, streamline your tax reporting, and save time. Here are some of the best apps for driving instructors to make tracking effortless.
| App | Key feature | Pricing | Integrates with |
|---|---|---|---|
| ATO myDeductions | Direct upload to tax return | Free | ATO online services |
| Driversnote | Auto tracking with GPS beacon | Free for 20 trips per month | Xero, QuickBooks |
| LBM Fleet Logbook | Hardware plug in with web dashboard | Monthly subscription | CSV export to any ledger |
🧾 Common Audit Triggers
Being mindful of common audit triggers for driving instructors can help you avoid unnecessary stress and keep your business compliant.
- Personal use of the work car – log book must show only business related kilometres
- Cash lessons not banked – Stripe and card data analytics flag mismatches.
- High vehicle claims without a log book – expect queries.
Mitigate risk with a current log book and reconciled merchant statements.
🚀 4 Quick Wins For the New Year
Small changes can make a big difference to your bottom line. These quick, practical steps can help you stay organised, improve cash flow, and reduce stress when tax time rolls around.
- Review your insurance: Income protection is often tax deductible.
- Block 1 hour per month for book reconciliation and KPI review so tasks never snowball.
- Use a dedicated business transaction account to keep all lesson income and operating costs completely separate from your personal banking.
- Open a separate high-interest savings account and move a slice of every EzLicence payout into it. By ring fencing the amount you expect to owe the ATO, you’ll earn a little extra interest and avoid last minute cash flow pressure when your BAS or annual return is due.
- Pro tip: Many instructors set aside 25-30% of each lesson fee, but check with your accountant for the percentage that’s right for you.
Disclaimer
The information in this guide is provided for general guidance only and is not personal financial, accounting, or tax advice. Circumstances vary for every business and individual; before acting on any content here, you should seek independent, professional advice from a qualified accountant or tax adviser who can consider your specific situation. We accept no responsibility for any loss arising from reliance on the material contained in this publication.
About the author
The EzLicence online platform brings transparency, choice and efficiency to booking and managing driving instructors and driving lessons in Sydney, Melbourne, Brisbane, Perth, Gold Coast and Sunshine Coast.