Notice of Assessment: What Arborists Should Look Out For

Why Your Notice Matters: Real-World Business Impact

Arborists face a unique mix of business challenges that show up each year in the assessment. Tree work is seasonal, so if you take on more jobs in summer but keep staff on year-round, inconsistent cash flow can mean under- or over-payment of income tax. ACT arborists often report six-figure revenue but end up drawing a much lower personal income—your notice reveals where the gaps and leaks are.

The assessment also highlights which deductions have been accepted and which got knocked back, especially for equipment or insurance premiums. Big changes for 2024-25 mean instant asset write-off for business purchases under $20,000—claimed fast in your tax assessment if done right. Missed payments or underestimated income can trigger surprise bills, extra interest, and ATO payment plans that hit your cash flow hard.

From our experience helping ACT arborists, here’s what trips up most business owners each year: not claiming equipment, protective gear, or training as deductions correctly, ignoring GST when turnover is above the $75,000 threshold, missing receipts or poor bookkeeping that mean lost deductions and audit risk, failing to account for seasonal income swings, and waiting too long to lodge objections to an assessment if you spot errors.

Key Components

Understanding each part of your notice helps you spot errors early and plan for next year. Start by matching each key number in your notice to your own tax records.

Taxable Income Breakdown

This is the total business income, minus deductions, that the ATO says you earned in 2024-25. Cross-check with your own profit and loss statement, make sure GST has been excluded correctly, and check if all allowable deductions like equipment, vehicle expenses, and insurance have been fully claimed.

Tax Offsets and Credits

The notice lists any tax offsets or credits such as the Low and Middle Income Tax Offset or Small Business Tax Offset. Confirm eligibility and application—don’t just assume you qualify. Double-check the rules and whether your income type allows these offsets.

Instant Asset Write-Off Claims

For 2024-25, arborist businesses with turnover under $10 million can instantly deduct the full cost of eligible new or second-hand business assets costing less than $20,000. Make sure any gear purchased like chainsaws, chippers, or computers under $20,000 is included in your deductions and appears on your notice if claimed. Keep detailed tax records including receipts, purchase details, and proof of business use.

GST and PAYG Details

If registered for GST, GST amounts must not be included in income calculations on your tax return—the assessment reflects income exclusive of GST. If your business has reached certain thresholds, PAYG instalments apply, which impact your tax situation and notice.

Equipment and Tool Deductions

ATO rules allow immediate deductions for work gear under $300, and depreciation for higher amount items. For arborists, this typically covers tools, chainsaws, trimmers, protective clothing, vehicle costs if used for work, and insurance premiums for income protection. Check your notice line items and cross-reference with your business purchases to ensure you haven’t missed a claim.

Common Problems: Spotting Errors Before They Bite

Mistakes on your notice of assessment can cost you money or trigger unwanted ATO attention. Here’s how to catch problems early and fix them properly.

Wrong Income or Deduction Claims

If your notice reports higher income or disallows deductions, review your tax records carefully. If you disagree, you must object within the required period—2 years for individuals and small businesses from when you receive your notice. Use the approved objection form, explain your grounds clearly and supply all supporting documentation.

GST and PAYG Mix-Ups

Errors in declaring GST turnover or omitting PAYG instalments could cause a mismatch, which the ATO may spot by data matching and trigger a review. Make sure your lodgment method accurately reflects your business structure and income streams.

Poor Record-Keeping Consequences

Missing receipts or poor documentation mean lost deductions. You must keep all tax records for 5 years after you lodge your tax return. Electronic records are fine—the ATO accepts digital copies if clear and complete. For claims without receipts up to $300 in total, detailed diary notes are required.

Seasonal Income Reporting Issues

If your income spikes in certain months, ensure the right income is reported for each period. The ATO looks for patterns and unusual changes, especially in industries with predictable cycles like tree services. Poor record keeping means lost deductions or risk of an audit.

Maximising Your Tax Position: Practical Strategies for Arborists

Getting the most from your notice of assessment means understanding what you can claim and planning ahead for better cash flow management.

Making the Most of Asset Write-Offs

Eligible arborist businesses can deduct the full value of new tools or equipment priced under $20,000 this financial year. Ensure assets are installed and used by 30 June 2025 and record business use properly. The $20,000 limit is per asset—multiple items can be deducted separately. Big equipment like vehicles, chippers, or larger machinery may be pooled and depreciated if over $20,000.

For cars, a depreciation cost limit applies—$69,674 for 2024-25. Keep detailed tax records showing business vs private use for any mixed-use assets.

Claiming All Allowable Business Expenses

Tools and equipment under $300 per item can be immediately deducted; otherwise, depreciate and apportion for business vs private use. Only income protection insurance cover is deductible, not general liability or personal injury premiums. External training for staff can attract a 20% bonus deduction if eligible under the small business skills boost.

Deduct business-related expenses for vehicle use, home office, travel, phone, and internet, but apportion correctly for business use with clear tax records and supporting documentation.

Managing Seasonal Cash Flow

Use cash flow forecasts to plan for lean periods, ensuring the tax you owe doesn’t surprise you. Invoice promptly, offer electronic payments, and encourage early payment from clients to bridge slow months. Track business expenses closely, delaying non-essential purchases until your cash flow can support them.

When dealing with financial hardship or serious financial hardship, contact the ATO immediately. Government agencies including other government agencies can provide assistance under certain circumstances.

Keeping Proper Records

Every claim—big or small—must have a supporting document like a tax receipt, invoice, or logbook. Keep these for at least 5 years. If an expense is both business and personal, only the business portion is deductible. Keep a written explanation for any split claims.

Poor record keeping means lost deductions or audit risk. The ATO uses powerful data matching technology to spot mistakes or missed income, so accuracy matters.

Industry-Specific Deductions for Tree Services

Arborists have some unique deductible expense categories under ATO rules that often get missed or incorrectly claimed.

• Equipment required for tree removal, pruning, climbing, and groundwork like chainsaws, chippers, ropes, and PPE can be immediately deducted if under $300 or depreciated if higher. Vehicle or ute costs used for transporting bulky tools can be claimed under logbook or cents-per-km method at 88 cents per kilometre for 2024-25.

• Training and certification courses relevant to tree work, provided by registered Australian providers, are deductible. Insurance premiums for work income protection only are deductible—other cover types are not. Repairs and maintenance costs for work gear are deductible, and project-related expenses such as land preparation, planting, or maintenance may apply.

• If you run a tree plantation operation for timber, additional rules apply for deducting establishment and maintenance costs—see forestry and primary producer tax resources or obtain a private ATO ruling for complex situations.

Building Long-Term Business Stability

Your notice of assessment reveals more than just this year’s tax position—it shows patterns that can help you build a stronger business.

Use your assessment to review profit margins and spot revenue leaks. If your business brings in $1.6M but you’re drawing $90K, it’s time for a comprehensive review. Build a financial buffer for seasonal swings and unexpected payments. Invest in efficient record keeping systems so you can claim all allowable deductions and respond quickly to ATO questions.

Use tax time as a reminder to check pricing, review wages, and assess asset purchases for instant write-off eligibility. If you’re confused by your notice or face ongoing issues with your tax affairs, talk to a professional tax agent with arborist experience.

How to Access and Manage Your Notice

Your notice is sent to your mygov inbox if you have ato linked services. If not linked to your myGov account, it comes to your postal address. For faster processing, ensure your bank account details are current in ATO Online Services.

Processing timeframes vary depending on your lodgment method—paper lodgments take longer than online services. When you pay tax or receive a refund cheque, keep copies as tax records. Your mygov account provides easy access to tax laws, processing timeframes, and other linked services from government agencies.

If you need assistance or have debt concerns, contact the ATO through their online services. For next year planning, review your notice carefully—it contains valuable information about your tax payable patterns and helps you prepare for future obligations.

Conclusion

The notice of assessment isn’t just an end-of-year ritual. For ACT arborists, it’s a health check on your business, your finances, and your future plans. Read every line carefully, act early if something looks wrong, claim every valid deduction, track your seasonal swings so your tax always matches reality, and keep tax records, receipts, and notes for everything.

If you want to make your notice of assessment work for you all year round—not just at tax time—get in touch with ACT Tax Group now. We’ll help you improve your business finances, claim every entitled deduction, and put in place practical systems so you get ahead—no more scrambling or confusion after the ATO letter drops.

Will this season be the one where your notice of assessment finally reflects the business you’ve built? Make this the year you take control of your cash flow, keep your tax bill in check, and grow your business with confidence.