Professional Indemnity Insurance Deduction: Who Qualifies and What You Get
Learn how contractors and consultants can claim professional indemnity insurance costs as a tax deduction in Australia.
This scheme allows certain professionals to claim the cost of professional indemnity insurance as a tax deduction.
Who it's for
This is intended for individuals working as contractors or consultants.
What you get
You can claim the cost of your professional indemnity insurance (sometimes called PI insurance) as a deduction. To do this, you must keep records that prove you held a valid policy and that you have actually paid the premiums.
What it costs you
There is no fee to claim this deduction. You only need to provide the necessary documentation showing your policy details and proof of payment.
The catch to know
The insurance must be directly related to your income-producing activities. If the insurance covers risks outside of your specific professional work, it may not be eligible for the deduction.
How to apply
- Keep all receipts and invoices showing your insurance payments.
- Maintain copies of your insurance policy documents.
- Report the expenses when you prepare your tax return.
- Check the official Australian Taxation Office website for current guidance.