Clearer Skin, Cleaner Books: Tax Strategies for Dermatology Clinics
- Jenine L.
- Aug 7
- 3 min read
Updated: Aug 7
Running a dermatology clinic in Australia isn’t just about skin health; it’s also about financial health. With rising operational costs, strict regulations, and a combination of Medicare and private income streams, effective tax planning is crucial for safeguarding your clinic’s profitability and long-term viability.
Here’s how to keep your clinic’s finances in good shape with strategic tax deductions, the right business structure, super contributions, and clean bookkeeping.
Top Tax Deductions for Dermatology Clinics
Dermatologists incur a range of business-related expenses that are tax-deductible under Australian law. Maximising these claims helps reduce your tax bill and improve cash flow.
1. Professional Expenses
Medical supplies and surgical tools (e.g. dermatoscopes, cryotherapy units)
Protective equipment: gloves, lab coats, masks
Software for appointment booking, patient records, and billing
2. Business Overheads
Clinic rent or lease payments
Utilities, phone, internet (business-use portion)
Cleaning services and medical waste disposal
3. Staff Costs
Wages and superannuation for nurses and administrative staff
Locum or contract dermatologists (ensure valid ABNs)
Staff uniforms with clinic branding
4. Professional Development
CPD events, workshops, and medical conferences
Membership fees (e.g. Australasian College of Dermatologists)
Subscriptions to dermatology journals or clinical software
Tip: Maintain clear records, both digital and physical, to substantiate every deduction in the event of an ATO review.
Choosing the Right Business Structure
Your structure impacts your tax obligations, asset protection, and overall efficiency.
Sole Trader
Easiest to set up
Taxed at individual marginal rates, it can become costly as income grows
Minimal protection for personal assets
Company
Flat 25% tax rate for base rate entities
Greater professional credibility and legal separation
More compliance with ASIC and director responsibilities
Trust (Discretionary or Unit)
Income can be distributed to beneficiaries, often family (if within ATO guidelines)
Excellent for asset protection
Complex setup, usually combined with a corporate trustee
Tip: Talk to a tax advisor to determine the structure that best supports your income, growth plans, and risk profile.
Superannuation Strategies for Clinic Owners
Super isn’t just about retirement, it’s a tax-smart investment strategy.
Contribute up to $30,000 (concessional cap for 2024–25) and claim a deduction
Use carry-forward provisions if you’ve under-contributed in past years
Make non-concessional contributions up to $120,000 to build wealth tax-free
Consider a Self-Managed Super Fund (SMSF) to invest in commercial property or shares with more control
Tip: Super contributions made through your business reduce your taxable income and boost your long-term financial security.
Bookkeeping Best Practices for Dermatology Clinics
1. Separate Business and Personal Accounts
Use dedicated business accounts and cards
Makes GST, BAS, and tax prep far easier
2. Choose Medical Accounting Software
Integrate Xero, MYOB, or MedicalDirector
Automate payroll, invoicing, and reconciliations
3. Track Income Streams Individually
Medicare vs private vs cosmetic vs product sales
Allows for accurate GST and tax planning
4. Budget for Tax and BAS Obligations
Clinics registered for GST must lodge quarterly
Set aside funds regularly for GST and PAYG
Tip: Partner with a medical-experienced bookkeeper or accountant. It reduces stress, avoids errors, and ensures compliance.
Let’s Keep Your Clinic’s Finances in Great Shape
Tax should never be an afterthought. With the right business structure, strategic deductions, consistent bookkeeping, and expert advice, your dermatology clinic can thrive financially while staying compliant with the ATO.
📞 Need help managing your clinic’s tax and accounting? At Dolman Bateman, we specialise in supporting medical professionals with tailored solutions that deliver clarity and confidence.
Contact us today to book your free consultation and make your practice financially fit.
Disclaimer:
The information provided in this article is general in nature and does not constitute personal financial, legal or tax advice. While every effort has been made to ensure the accuracy of this content at the time of publication, tax laws and regulations may change, and individual circumstances vary. Dolman Bateman accepts no responsibility or liability for any loss or damage incurred as a result of acting on or relying upon any of the information contained herein. You should seek professional advice tailored to your specific situation before making any financial or tax decision.
