Finance and tax

Cost of managing tax affairs

Tax agent, BAS agent, recognised tax-advice and related costs incurred to manage tax affairs.

Reviewed 30 July 2026Income years 2025-26 and 2026-27

Who can claim

This deduction is available to individuals and companies.

  • The cost is incurred in managing tax affairs, such as preparing or lodging a return or activity statement, recognised tax advice, tax software or dealing with the ATO.

What you cannot claim

  • Tax shortfall penalties and similar penalties are not deductible.
  • General interest charge and shortfall interest charge incurred on or after 1 July 2025 are not deductible.
  • Financial advice unrelated to managing tax affairs is not deductible under this heading.

How the amount is worked out

Claim the deductible incurred amount, apportioned where the service has a separate non-tax purpose.

Records the ATO expects

  • Invoice from the adviser or supplier
  • Description of tax-related service
  • Apportionment for mixed-purpose software or advice

Where this rule comes from

Primary source: Income Tax Assessment Act 1997 sections 25-5 and 26-5 (Compilation 266 in force 1 July 2026). Reviewed 30 July 2026. Covers the 2025-26 and 2026-27 income years.

Supporting sources:

Next steps