Australians LOVE coffee, so a good-quality coffee machine that’s well-loved and well-used is a staple in most workplaces. With a large percentage of Australian businesses spending money on a coffee machine, coffee beans or tea for their employees, it raises the question of whether these items can be claimed at tax time? In today’s blog, we’re taking a look at what you can and can’t claim so you and your workforce can enjoy a fresh brew each day without breaking the bank! Keep reading to find out more.Â
Can you claim a coffee machine at tax time?
Put simply, yes you can. In Australia, a top-shelf coffee machine for the office can be claimed as a tax deduction during the financial year or later. If your coffee machine is more than $300 and less than $3,000 for that financial year, you can claim it as part of “other property” on your tax return. However, the rules can change depending on which State or territory you’re living in, so it’s best to chat with your accountant or the Australian Taxation Office (ATO) directly about claiming a coffee machine at tax time.Â
What if I’m leasing a coffee machine for the office?
Unfortunately, if your business leases the coffee machine, you can’t claim it as a tax deduction. This is because leased property isn’t considered to be ‘your property’. But the good news is you can claim a tax deduction for the lease itself, so there are tax benefits to both buying and leasing an office coffee machine.Â
What about coffee served during meetings?
The cost of serving clients coffee or serving a fresh brew during a staff meeting can add up during the financial year, so can you claim this as a business expense? The answer to this all depends on context. For example, if the coffee you served was prepared in your office, using your coffee machine and beans, then it can be claimed. However, if the meeting took place outside the office, such as at a local café, then this could be considered ‘entertainment’ and therefore can’t be claimed. But there are loopholes when it comes to meeting expenses, so chat to your accountant about how best to label this expense at tax time.Â
What is considered a coffee machine?Â
This might seem like a silly question, but the definition of a coffee machine can actually mean many different things. For tax purposes, a coffee machine is considered any item that is used as a means of making or serving coffee or tea, such as a drip filter, automatic coffee machine, percolator, semi-automatic coffee machine and so on. But if you’re unsure if your office can claim a coffee machine at tax time, talk to your accountant or the ATO before making any purchases and/or deciding to lease the item.Â
As you can see, there are plenty of tax benefits to be had when it comes to renting or buying a coffee machine for the office, so make the most of them! But the most important thing to remember before you claim a coffee machine at tax time is that the machine must be used solely for business purposes. And of course, you’ll need to keep track of all receipts throughout the financial year. For more tips and tricks and to stay on top of the latest coffee news, make sure you subscribe to the Corporate Coffee Solutions blog today!
