Always let your accountant know before you make a big purchase

Why you should always (ALWAYS) tell your accountant about big company purchases, even if you’re not planning on claiming a deduction on tax…

When you make a big company purchase using your business or in your company’s name, it might seem harmless and entirely up to you to make the call, especially if you’re not planning to claim it as a tax deduction.

But under Australian tax law, just putting something in your company’s name can trigger significant tax implications, whether you realise it or not.

That’s why it’s essential to keep your accountant in the loop on any major business purchases, even if you think they’re not tax-relevant.

‘But I didn’t plan to claim it…‘

It’s a common misconception that tax consequences only arise if you actively claim an expense. In reality, many compliance obligations are triggered simply by the way a company purchase is made, especially if it’s in the name of a company or trust.

The ATO is cracking down, especially on motor vehicles.

One of the biggest areas of concern right now for the Australian Taxation Office (ATO) is motor vehicle expenses and Fringe Benefits Tax (FBT).

The ATO has made it clear that they are closely monitoring company-owned vehicles.

Even if you don’t intend to claim fuel, servicing, or depreciation costs, the fact that a car is registered in the company name can trigger FBT reporting obligations.

How this can work:

Buying a car under the business name = ATO assumes it’s available for private use.
Private use = Potential FBT liability.
No reporting or calculation = Red Flag.
Red Flag = Audit and potentially big tax bill.

Even if the vehicle is only ever used for business, the ATO expects documentation and declarations to prove that. Otherwise, you might be hit with unexpected taxes or penalties.

And, it’s not just cars!

Motor vehicles are a key area the ATO is focused on at the moment, but it’s only one example.

Other big-ticket company purchases like equipment, technology, or even real estate can also affect your tax position in various ways, which is why your accountant needs to be across all of it.

For example:

Buying a car through your company may trigger Fringe Benefits Tax, regardless of deductions.
Purchasing real estate in a trust may impact land tax, stamp duty, or capital gains exposure later.
Acquiring software or tech on subscription may change your asset pool or GST reporting.
Even if you’re not claiming a deduction or GST credit now, how you record and report the transaction matters for your ongoing compliance and tax planning.

The solution: Always let your accountant know before you buy.

To avoid accidental non-compliance or tax surprises, it’s best to run any major purchases past your accountant before committing. This is especially if it’s in your company or trust’s name.

And if you’ve already made the purchase, disclose it at tax time (or earlier if possible). Even if you don’t plan to claim it. That way, it can be handled correctly in your financial records and tax reporting.

A simple conversation can save you thousands.

Tax in Australia is complex and interconnected. What seems like a simple company purchase can have ripple effects on your obligations. Taking a few minutes to consult your accountant could save you from unintended consequences, audits, or unnecessary tax bills.

If you’re planning to make a big company purchase like a motor vehicle, equipment, or any other major asset, please contact your Aintree Group adviser for advice before you sign the dotted line.

Have you made any major company purchases this financial year? Please get in touch with our team if so!

This is general advice only and has not been prepared with your situation and needs in mind. For individual and personalised advice, we highly recommend that you seek out proper professional advice from your accountant.