Track business expenses early to stay transparent, claim deductions, and show investors you’ve got real skin in the game.
- Simon. P
- Sep 4
- 7 min read
Updated: Nov 25
If you don’t track business expenses, you’re leaving money on the table — and the ATO won’t remind you.
Introduction
Launching a business in Australia often starts long before anything is official. You haven’t registered an ABN yet. You haven’t opened your doors. You might not even have a name. And yet, without realising it, you’ve already started paying for your future.
A domain name here.
A Canva upgrade there.
A quick call with an accountant “just to make sure.”
A designer who helped you shape the first version of your brand.
These small decisions are the early proof that you believe in the idea you’re building.
They’re also the very expenses most founders forget to track — and that’s exactly how hundreds (sometimes thousands) of dollars quietly disappear.
Receipts get lost.
Personal card purchases blur into everyday life.
And by the time tax time rolls around, you can’t remember what was business, what was personal, or what was even relevant.
Tracking expenses early isn’t glamorous. It doesn’t feel like “launch mode” or make you feel more legitimate. But this habit is one of the smartest moves you can make as a founder. It sets you up to claim deductions, stay transparent with investors, and understand — with total clarity — what you’ve already invested into your own dream.
Think of tracking as a quiet leadership skill.
It’s not loud.
It’s not flashy.
But it sets the tone for the kind of founder you’re becoming: one who knows where every dollar is going, and why it matters.
Let’s start with the basics — what pre-business expenses actually are — so you can track them with confidence from the very beginning.
What Are Pre-Business Expenses?
Before your business has a logo, a website, or even an ABN (Australian Business Number), you’re already building the foundation — and spending money to do it.
Pre-business expenses are any costs you incur before your business is officially operating, but that directly contribute to getting it started.
Many founders underestimate how much these early investments add up. Even fewer realise they are often claimable later — but only if they’ve been tracked properly.
Common examples of pre-business expenses in Australia:
Legal fees for company setup
ASIC registration and business name fees
Accountant or tax advice
Market research, surveys, or feasibility reports
Domain names and early website design work
Branding, logo design, and creative assets
Software subscriptions or SaaS tools (SaaS = software you pay for monthly)
Business-related travel or early meetings
Equipment or tools you intend to use once trading
Here’s the simple rule:If the expense helps you start the business, it’s a pre-business expense worth tracking.
And yes — even if you pay with your personal card, you can still log it. It may be deductible later.
Why Tracking Pre-Business Expenses Matters
For founders in their early years, clarity is everything. Tracking expenses early isn’t just about tax — it’s about control, confidence, and credibility.
Here’s what smart tracking gives you:
1. Tax deductions
Some pre-launch costs can be deducted once your business starts trading.No tracking = no claim.
2. Investor transparency
Investors want to see founders who are organised, prepared, and accountable.Showing “here’s what I’ve already invested” instantly builds trust.
3. Better asset management
Did you buy a laptop? Software? Equipment?These may be depreciated (ATO term for “write a portion off each year”).
4. Clarity on your real startup costs
Most founders underestimate how much they’ve actually spent. This gives you a grounded, realistic baseline.
5. Proof of founder investment
If you ever need loans, partners, grants, or investors, this record shows commitment and skin in the game.
Real talk: When I launched my first business, I tracked every single dollar in a spreadsheet. That simple log impressed my first investor more than my pitch deck. They saw discipline — and that goes a long way.
What You Need Before You Start Tracking
You don’t need a fancy system. You just need consistency.
A simple tracking tool
This can be:
A spreadsheet
Xero
MYOB
Rounded
Wave
Pick what you will actually use — not what looks impressive.
A cloud folder for receipts
Google Drive, Dropbox, OneDrive — anything simple and accessible.
A short description of your business idea
This helps your accountant later. Even a rough draft helps clarify what expenses directly relate to your startup.
Start tracking the moment you spend the first dollar.
Your ABN can come later. Your receipts shouldn’t.
How to Track Pre-Business Expenses in Australia:
Step-by-Step
This is the part most founders overcomplicate. Let’s make it easy.
Step 1: Set Up a Separate Bank Account or Card
You don’t need a registered business to do this — just open a new account or use a clean credit card strictly for startup expenses.
Why?
Because separating business from personal spending now saves you hours later.
Do this today:
Open a new account (most banks let you do this online)
Label transfers from your personal account as “Loan to Business”
Make all pre-launch purchases from this one card
Mentor Tip:If you ever raise money or apply for grants, having a clean transaction history makes you look like someone who knows what they’re doing.
Step 2: Create Your Expense Register
This is simply a log of what you spent.
Your spreadsheet needs only six columns:
Date
Supplier
Description
Amount
Payment method
Notes (e.g., “receipt stored in Drive”)
If you prefer software:
Xero (full accounting system)
MYOB (affordable and Australian)
Rounded (great for sole traders)
Wave (free for lean teams)
Mentor Tip: Choose whatever your accountant already uses. It saves everyone time and confusion later.
Step 3: Categorise Every Expense
Categories help both you and the ATO (Australian Taxation Office).
Use these:
Professional Services
Marketing & Branding
Technology & Software
Travel & Accommodation
Equipment & Assets
Research & Development
If you’re unsure, use the ATO’s business expenses page for guidance.
Your future self will thank you for being tidy here.
Step 4: Keep All Supporting Documents
ATO rule: No receipt = No deduction.
Make this your startup law.
Do this:
Photograph paper receipts
Store PDF invoices in your cloud folder
Use apps like Expensify, Dext, or Hubdoc if you want automation
Link receipt folders to your spreadsheet
It doesn’t need to be perfect — it just needs to be consistent.
Step 5: Talk to Your Accountant Before You Launch
This step saves thousands and avoids nasty surprises.
Your accountant will help you sort:
What’s deductible now
What needs to be treated as an asset
What can be carried forward
How to organise your founder contributions
Mentor Tip:Founders often wait too long to talk to their accountant.A 20-minute chat now can prevent a two-year headache later.
Cost of Setting Up Your Tracking System
DIY Spreadsheet: Free and depending on your experience, 1-4 hours per week
Accounting Software: $0 - $100/month depending on features
Receipt Management Apps: Free - $20/month
Accountant Consultation: $300 - $1,500 (initial setup guidance)
Money-Saving Tip: Start lean. Don’t rush into fancy tools or expensive software—begin with a simple spreadsheet and free cloud storage. Once your business gains real traction, then you can consider upgrading.
When you’re ready for your first hire, be intentional. Look for someone whose skills not only complement what your business needs but also free you from the day-to-day tasks. That way, you can focus on building the business, rather than getting stuck working in it.
Common Mistakes Founders Make
Not tracking from day one
Memory fades. Records don’t.
Mixing personal and business spending
It makes claims harder — and sometimes impossible.
Losing receipts
ATO doesn’t accept “but I bought it, I promise.”
Skipping the accountant
You don’t need a CFO — but you do need early advice.
Forgetting sweat equity
If you’ve invested time, track it. Investors want visibility on founder contribution.
What to Do Right Now
✅ Open a dedicated bank account or card for startup costs
✅ Want help. Book a session with Noize — for founders ready to set up smart financial systems starting with tracking your expenses and setting up growth strategies that solidify the foundation of your startup. [Contact Noize.com.au]
✅ Explore the Startup Deck — Your go-to resource for building, protecting, and launching your startup the right way — with expert tools across every area of the business. [Visit theStartUpDeck.com]
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✅ Download free templates and resources on ProDesk— Your go-to resource for building, protecting, and launching your startup the right way — with expert tools across every area of the business. [Visit ProDesk.com]
The Bottom Line
Tracking your pre-business expenses isn’t just admin—it’s smart business. It positions you for tax advantages, investor transparency, and financial control from the very start.
Don’t wait until your accountant asks. Track today, and tomorrow you’ll have the financial clarity and credibility every strong business needs.
💬 FAQs
Can I claim expenses I paid before registering my business?
Yes—many startup expenses are claimable once you're officially trading, as long as they’re documented properly.
Can you claim startup costs in Australia after launching?
Absolutely, but you must show that they were directly tied to setting up your business.
What if I use my personal card?
That’s fine to start—just keep every receipt and note the business reason for each transaction.
Do I need an ABN before tracking startup costs?
No. Track now. Just ensure everything is linked clearly once your ABN is active.
Can I reimburse startup costs under ATO rules?
Yes, but only if they’re documented correctly. The ATO requires clear records and proof that expenses were directly related to business setup. If you’re a sole trader or director, you may be able to reimburse startup costs from the business account once trading begins.
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