Writing a lifestyle blog has become a great way to build influence and followers in the social media community and a few people – a tiny number – are actually making real money from their endeavours.
So whether you’re blogging about food, travel or health and beauty, what exactly can you claim as a tax deduction?
Unfortunately, as lifestyle blogging is a relatively new profession – if indeed it’s a profession at all – there is very little guidance from the tax office.
What we can do, however, is apply existing tax law to the types of expenses bloggers incur, and from that we can produce a list of the things you can probably claim and also a list of the things you almost certainly (sadly) can’t claim.
First, you need to be blogging as a business, rather than just a hobby.
That means you are probably regularly earning money from your activity, either in direct fees or sponsorships from companies about which you blog or in subscriptions from readers if you operate a pay-per-view model.
If that’s the case, you’ll be able to claim deductions for the costs you incur as part of your blogging.
If you’re simply putting out your thoughts to the outside world and aren’t making any money from it, or even trying to make money, you really can’t claim any deductions at all.
So let’s focus on the good news and look at the types of expenses you can claim if you have a blogging business.
You’ll be able to claim for your internet-related expenses, including hosting fees for your blog, domain name registration fees, blogging software fees and image or music downloads for your blog.
You’ll also be able to claim a proportion of your home internet costs if you run your blogging business from home (or all your internet costs if you work from a dedicated office away from home).
Assuming you’re a self-employed blogger, until June 30, 2018 you can claim an immediate tax deduction for any item of capital equipment you purchase for use in your business provided the cost is less than $20,000.
That could include your computer or laptop, the wireless router, keyboard, mouse, monitor, webcam and digital camera.
From July 1, 2018 the cost threshold falls to $1000 per item – still enough for most bloggers to claim many of the items listed above.
If you run your blogging business from home, you can claim part of the rent or mortgage interest on your home as a tax deduction, assuming you have a dedicated office.
(But make sure you claim an appropriate proportion compared with the overall size of the property; this is an area the ATO looks at closely.)
You can also deduct a portion of your household bills for that space if you use that space to conduct your blogging business. That could include a proportion of your electricity, water and gas.
You’ll be able to claim for business-related landline and mobile phone calls, as well as a proportion of the cost of the mobile phone itself.
Using the $20,000 instant asset write-off (see computer equipment, above), you’ll also be able to claim office furniture such as a desk, chairs and filing cabinets.
Office supplies and stationery
All the stationery and office consumables you use in your blogging business are claimable, including business cards and letterheads (if you still occasionally send things out on paper!)
Advertising, promotion and design
A key to getting your blogging brand out there is to invest in cutting-edge design and promotion so you’ll be able to claim related costs including blog design, advertising, logo design, promotional giveaways and search engine optimisation services.
There’s an array of other items you might be able to claim including the costs of reusing photos or images owned by another entity, the costs of employing a professional photographer to create headshots for use on your blog and in promotional items and the cost of employing an accountant to prepare your tax return or give you tax advice.
Things that can’t be claimed
While the general rule is that expenses that are incurred in earning your assessable income are deductible, this excludes anything that might have a private or domestic purpose.
So while travel bloggers might like to claim the cost of their journeys to exotic overseas lands, food bloggers might like to claim the cost of the food they prepare or eat and health bloggers might like to claim the cost of a gym membership or a new beauty product, the ATO will almost certainly say no to all of these because, despite the costs being incurred as part of the blogging activity, the costs are mainly private or domestic in nature.