Buying a Shed at Tax Time – Can a Shed Be A Deductible Business Expense?

Can a Shed Be a Business Expense?

2018 is flying by, and it’s nearly that time of year again. Yes, the end of financial year is fast approaching, and although it may be at the back of most people’s minds, it’s important to know what can and can’t be classed as a business expense.

Whether you have bought a shed for your business in the last financial year, snapped one up during our EOFY sale, or are looking to buy one in the future and use it as your workspace from home, while you sort through your expenses and weigh up your options, we thought we’d make it easier to outline whether your shed, or future shed, can be classed as a business expense.

Option A: The Shed is on Your Business’ Property

If your shed is purely for business purposes, you have two options when it comes to tax time.

First, you may be able to put your shed on a depreciation plan, meaning you can claim the cost of the shed over time, reflecting the asset’s depreciation, if any.

Alternatively, any small business with a turnover of less than $10,000,000 can purchase assets up to the value of $20K. If your shed is placed on your business’ property, this can be written off as a business expense and includes all the assets and tools inside your shed up to value of $20K.

Option B: Your Shed is On Your Personal Property and Used for Business

If you use your shed exclusively as a work area for business purposes, but your home isn’t your principal place of business, you may be able to claim some aspects as an expense.

If your shed is on your home property, and you use it for a mix of personal means and for work, you must first work out what percentage of your time is spent working from this shed.  A certain percentage of your time must be spent working from this shed, and once this has been calculated talk to your accountant about your options.

The ATO keeps a close eye on deductions that taxpayers claim when working from home, so if you’re ever unsure it’s a good idea to chat to a professional accountant.


Of course, if you missed the boat on purchasing your dream shed for your home or business this financial year, there’s always a silver lining. Once you receive your tax return next year, come on in and talk to the shed experts at Sheds Galore. Together, we can help you find the ideal shed for your home or business in time for tax time next year.

If you have any more questions about your shed and tax time, have a chat to your accountant, because while we’re passionate about sheds, we don’t know everything about taxes.

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