Surgeons face a unique set of tax challenges and opportunities. With high incomes, demanding professional obligations, and complex financial arrangements, strategic tax planning isn’t just helpful; it’s essential. Here's what every Australian surgeon should know to maximise legal deductions, avoid ATO scrutiny, and plan for the future.
Surgeons may be eligible to claim deductions for expenses directly related to their professional duties, such as:
⚠️ Caution: Travel between home and a regular place of work is generally not deductible. Only travel between multiple unrelated work sites or for eligible work duties may qualify.
Tax Tip: Keep clear records and receipts. Substantiation is critical: no receipt, no deduction.
⚠️ Note: Premiums for policies that include trauma, life, or TPD (Total and Permanent Disability) components are not fully deductible. Only the income protection portion may be claimed.
With the rise in telehealth and remote administrative duties, surgeons may claim certain home office expenses, including:
💡 In the 2025 financial year, the ATO fixed rate method is $0.67 per hour, which includes electricity, internet, and phone usage. Alternatively, the actual cost method may be used with detailed records.
Choosing the correct business structure is a cornerstone of long-term tax planning. Options include:
⚠️ Serious Warning: The ATO closely monitors attempts to split income using trusts or service entities. Income earned from personal exertion (i.e. from performing surgery or consulting) must generally be reported by the individual. Distributions to family members who do not work in the practice are likely to attract ATO scrutiny.
⚠️ Also consider: Personal Services Income (PSI) rules may apply. If most of your income is from your own skill or effort, PSI rules can limit deductions and restrict income splitting strategies. Always check with a tax advisor.
Superannuation is one of the most tax-effective strategies available to high-income professionals:
⚠️ High-Income Surcharge: If your income exceeds $250,000, you may be liable for Division 293 tax, which adds an extra 15% on concessional contributions (total 30%).
Tax Tip: Maximise concessional contributions before EOFY, but avoid breaching caps or triggering excess contribution penalties.
An SMSF offers more control over investment decisions, including:
⚠️ Important: SMSFs must be compliant with the ATO’s sole purpose test, trustee obligations, annual audits, and reporting. Non-compliance can attract penalties or loss of concessional tax status.
Tax Tip: Seek licensed financial and legal advice before establishing an SMSF. It’s not suitable for everyone.
Eligible prepaid expenses can be claimed in the current tax year, including:
Tax Tip: Prepaying expenses can be a smart EOFY tax strategy, particularly for those with a high marginal tax rate.
⚠️ Caution: If PSI rules apply, some investment-related deductions (like negative gearing) may be limited. Always assess whether your income is classified as PSI before proceeding.
Tax Tip: Tax should not be the only driver of investment decisions. Work with a licensed financial adviser to ensure your investments match your risk profile and long-term goals.
Surgeons operate in a high-risk, high-reward profession. With high income, tight ATO scrutiny, and complex financial decisions, it’s critical to:
At Dolman Bateman, we specialise in tax planning for medical professionals. We understand the regulatory landscape and work closely with you to deliver smart, compliant, and strategic financial outcomes.
We offer personalised tax planning services tailored to the medical field. Whether you're in private practice, hospital-based, or balancing both, we’ll help you make the most of your income, legally, strategically, and sustainably.
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 decisions