The reconciliation section of a tax return allows the accounting income to be reconciled to the taxable income. The reason for this is that certain income items may not be assessable or the amounts may differ. Similarly, with expenses, some accounting amounts may not be deductible or amounts may differ.
Small business depreciation isn’t imported for non-deductible expenses in case of SBE rules. User only needs to fill 10A in Depreciation tab and 6X in Proft&Loss. Learn more HERE
Following the ATO rules, LodgeiT does not import accounting depreciation as non-deductible for SBEs. Enter tax depreciation at item 10A (Depreciation tab) and 6X (P&L), ensuring 6X equals 10A + 10B per ATO rules—no reconciliation required.
This aligns with instant asset write-off and general pool rules; accounting depreciation ≤ tax amounts to qualify. Enable via Settings > Depreciation > Use simplified depreciation rules (only for SBE).
Related Article:
- CTR: Small Business Entity
- CTR: Understanding the Reconciliation Section - Company Tax Return (CTR)
- TRT and PTR: Small Business Entity (SBE) Item K: "Depreciation Expenses on Accounts" (simplified depreciation rules)
- TRT: Understanding the Reconciliation Section in Trust Tax Form (TRT)
- PTR: Understanding the Reconciliation Section - Partnership Tax Return (PTR)
- Small business tax offset for Individual Tax Return (ITR)
- ITR Depreciation Expense > SBE > P10
- Depreciation on Business Income in Individual Tax Return (ITR)