Tax Tips Every Tradie Needs to Know in 2025 

Tax time can be a real headache for tradies, but it doesn't have to be. 

Whether you're running a plastering business, working as a subcontractor, or as an employee, understanding the complex world of tax deductions can be a game-changer for your financial strategy. These insights provide smart ways to save money, maximise deductions, and keep more cash in your pocket. 

For small businesses, tax isn't just an annual obligation—it's a strategic tool for business growth and financial security.

We sat down with Dylan Eve, Partner and Client Director at Xact Accounting who specialises in building and construction, to get the inside scoop on the top tax tips for 2025. 

Here are the top tax tips every tradie and small business owner needs to know in 2025.

This is a big one! You can write off up to $20,000 for each piece of equipment you buy. And get this—it's not just a one-time $20,000 limit. If you buy three tools at $15,000 each you can still claim the write-off on each one.

Meaning the threshold is per asset, not cumulative.

As long as the tools or equipment are individually priced under $20,000, you can still claim the full write-off on each item even though the total invoice for all the equipment might be, for example, $45,000 plus GST.

In essence, this is a tax break that lets tradies write off equipment purchases quickly(that would otherwise depreciate over 8-10 years), instead of spreading the cost over years.

But this write-off is only available for a couple of weeks, as it’s due to reduce to $1,000 plus GST after 30 June 2025. So, if you're thinking of making purchasesbefore end of financial year, focus on individual items that are under the $20,000 threshold. 

Invoice timing is a tax time hack for tradies looking to optimise their tax strategy.

Any invoice received by 30 June 2025 is deductible in the 2025 tax return, even if you haven't paid it yet. This means you can bring your tax deduction forward by strategically timing your invoices.

This could mean invoicing clients early or prepaying for stock before the end of the financial year.

The benefit? You're claiming the tax deduction 12 months earlier than you would if you waited. If you’re invoicing early there's a small trade-off—the income becomes assessable in the current year.

The key strategy is to be proactive. If you've got a job lined up for July or August, try to get those invoices in before 30 June because the real advantage is getting the tax deduction 12 months earlier. This means any expenses related to that job can then be claimed as deductions in the current tax year.

There’s nothing more tedious than paperwork, but in this instance, it can pay to keep a close eye on. Especially those outstanding invoices. If you've got debts that look unlikely to be paid after 90-120 days, write them off.

Why? So you're not paying tax on money you might never see.

If that client suddenly pays you later, the debt gets added back as assessable income. It's like a safety net that prevents you from being taxed on phantom income.

You should regularly monitor your accounts receivable ledger which behaves as the running list of clients who owe you money.

The key is proactivity—regularly reviewing your outstanding invoices, chasingpayments, but also be prepared to write off debts that are realistically never going to be paid. It's about managing your cash flow and tax liability smartly.

For tradies and small business owners, the right structure is your financial shield. In industries like construction, where risk is high, how you set up your business can protect your personal assets if something goes wrong.

Different structures suit different business needs, such as sole trader, partnership, company, or trust.

Business owners especially need to be strategic about creating a structure that generates wealth, protects that wealth and provides long-term financial security.

For trades businesses, this becomes even more critical with industry-specific requirements like QBCC licensing, which has minimum financial requirements. Your business structure can impact your ability to meet these standards and maintain your professional credentials.

Don't just think about your business as it is now, but how it can be structured to protect and grow your financial future. In the long run it pays to stay proactive and consult a tax professional for personalised advice, with the option to make changes before 30 June 2025 or 2026.

Super contributions are due by 28 July 2025, and there's a strategic tax advantage to paying them before 30 June. By paying employee super contributions early, you can claim the tax deduction in the 2025 tax return.

By paying before 30 June, you bring the tax deduction forward by a month, and get the tax saving 12 months earlier. Note that the funds need to be received in the employee’s Super Fund, so allow time for your clearing house of choice to process the payment (i.e. Xero or MYOB).

It's another example of being proactive with your tax strategy and business expenses. Just like with invoice timing and asset write-offs, super contributions are another opportunity to manage your tax liability more effectively.

 For tradies and small business owners, it's about looking at these small strategies that can add up to meaningful tax savings over the year.

Turn this tax time from a headache into an opportunity

Whether you're a plasterer, subcontractor, or running a trade business, these tips can help you keep more money in your pocket.

The big-ticket item is the $20,000 instant asset write-off, which lets businesses claim full tax deductions on individual tools and equipment purchases before 30 June 2025. 

For tradies and small businesses looking to maximise their financial potential, understanding these tax nuances can make a significant difference to their bottom line.

Pro Plaster can provide our customers with collated reporting and linked invoices to make your claims more straightforward this tax time. So if you’ve misplaced invoices our want to double check your accounting, reach out to the team today! 

DISCLAIMER:

The tax information provided is general advice only and does not constitute specific financial or tax recommendations. Every business is unique, and tax strategies that work for one may not be suitable for another.

Please refer to the ATO’s guidelines before claiming tax deductions. Tax laws and regulations change frequently, and what applies in 2025 may not be applicable in future years. For personalised tax advice tailored to your specific business situation, please contact a registered tax professional or chartered accountant.

For a deeper dive into navigating the complexities of tax in the building and construction industry, download Xact Accounting’s comprehensive guide “Top 10 Tax Tips for Builders and Tradies.”