Your investment in professional or executive coaching may be tax deductible. That's a resounding possibility, so be sure to discuss your specific situation with a tax professional. To be fully tax deductible, your advisor should only advise you on business matters. However, if your coach is a life coach, a coach who advises you on both business and personal matters, only the business part of their fees would be tax deductible.
Any business insurance you take out to safely manage your coaching business can be deducted from your taxable income. In addition to income tax, you'll also have to pay a self-employment tax if you run a personal coaching business. Based on this subtle distinction, executive coaching is most likely a deductible work-related expense, but professional coaching may not be considered as such. However, you wouldn't count your monthly advertising expenses as an upfront cost, even if you use advertising to “start” your coaching business and get your first client.
While some forms of counseling, such as business advice, may be tax deductible, personal coaching, on the other hand, can be considered a personal expense, so you may not be able to get a deduction. In addition, people who hire a business consultant can get a tax deduction, as they can help you with your vision, mission, marketing strategies, building relationships with customers and employees, etc. If you want to take advantage of a tax deduction, you should work in the field of business coaching. Therefore, hiring a life coach may not be considered a tax-deductible expense because the ATO may think that life coaching doesn't directly affect a company or contribute to business growth.
