BB4u – Personal Service Income (PSI): Tax Guidance & Compliance

Step 1 of 7

Your Details

Please enter your details so we can identify your assessment. All information is submitted directly to your tax agent.

Full Name *

Email Address *

ABN (if applicable)

Business / Trading Name

Financial Year *

How do you earn income from personal services?

Step 2 of 7

Is your income Personal Services Income? s 84-5 ITAA97

Income is PSI if more than 50% of what you receive from a contract is for your personal labour, skills, or expertise — rather than from supplying goods, using assets, or the efforts of a business team.

Examples of PSI: IT contracting, consulting, engineering, accounting, coaching, trades work — where you are paid mainly for what you do, not for a product you sell or a business you operate.

Examples that are NOT PSI: Running a café, renting out equipment, selling goods, or where a substantial income derives from a business structure.

Do you primarily earn income by performing personal services (using your own skills, knowledge or labour)?

Yes

More than 50% of what I receive from contracts/assignments is a reward for my personal efforts, skills or expertise.

No

My income comes mainly from selling goods, using assets, or from the efforts of other people in my business.

Unsure

I'm not sure — I'd like my tax agent to help me determine this.

Step 3 of 7

The Results Test s 87-18 ITAA97

You are a Personal Services Business if 75% or more of your PSI comes from contracts where all three of the following conditions are met. Tick each one that applies to your work for at least 75% of your PSI.

Paid to produce a result

Your contract requires you to produce a specific result or outcome — not merely to be available to work or to perform duties. Payment depends on completing the work to a standard.

You supply your own tools & equipment

You provide the substantial tools, equipment, or resources needed to perform the services — not your client's equipment.

You are liable to fix defects at your own cost

Under the contract, if your work is defective or incomplete, you are responsible for rectifying it without additional payment from the client.

What percentage of your PSI income comes from contracts that meet all three conditions above?

Step 4 of 7

The 80% Rule s 87-15 ITAA97

Before applying the other PSB tests, we need to check the 80% concentration rule. If 80% or more of your PSI comes from a single client (or a client and their associates), you can only qualify as a PSB by satisfying the Results Test.

Associates include related companies, trusts, relatives, and anyone the client controls. The ATO looks at the substance of relationships, not just the name on the invoice.

Does 80% or more of your PSI come from a single client or from a single client and their associates?

Yes

One client (or client + associates) accounts for 80% or more of my PSI in this financial year.

No

My PSI is spread across multiple unrelated clients — no single source makes up 80% or more.

Unsure

I'm not sure of the exact percentage split.

Step 5 of 7

Unrelated Clients Test s 87-20 ITAA97

You pass this test if you make your services genuinely available to the public and at least 80% of your PSI comes from two or more unrelated clients during the year.

Do you actively offer your services to the general public — for example via a website, business listing, advertising, or word-of-mouth in the marketplace?

Yes

I advertise my services and accept work from members of the public / general business market.

No

I only work for clients I'm specifically referred to or recruited by — I do not advertise to the public.

During this financial year, did you earn PSI from two or more unrelated clients (clients who are not related to each other or to you)?

Yes

At least 80% of my PSI came from 2+ unrelated clients.

No

My work was primarily or exclusively for one client (or related clients).

Unsure

I'll need to check exact income splits with my tax agent.

Step 6 of 7

Employment & Business Premises Tests s 87-25 / s 87-30 ITAA97

Two further ways to qualify as a PSB. You only need to pass one of these.

Employment Test — Do you have employees or subcontractors who perform at least 20% of your principal work (measured by market value)?

Yes

Employees or subcontractors perform 20% or more of the work for which I receive PSI (by market value). This does NOT include work that is purely incidental (admin, reception, etc.).

No

I personally perform all or almost all of the work myself.

Business Premises Test — Do you maintain and use business premises that meet all four conditions below?

Separate from your home or private residence

The premises are not part of your home, even if your home is used for some work.

Not at a client's premises

The premises belong to you (or your entity) — you are not using a room or desk at your client's site.

Used mainly for performing your services

The premises are used predominantly to perform income-producing activities — not for personal or domestic purposes.

Available exclusively for business use at all relevant times

The space is exclusively available for business use — not shared with your family or used for non-business purposes.

Step 7 of 7

Additional Information

Almost done! Please answer a few extra questions to help your tax agent prepare your return accurately.

Do you have an interposed entity (company, trust, or partnership) through which you receive or channel the PSI?

Yes

My PSI is received through a company, trust, or partnership that I control.

No

I earn the income directly as an individual.

Have you previously received a Personal Services Business Determination (PSBD) from the ATO for this type of work?

Yes

I hold or have previously held an ATO determination confirming PSB status.

No

I have never applied for or received a PSBD.

Is there anything else you'd like your tax agent to know about your work arrangements?

Assessment Result

Test-by-test summary

Important: This questionnaire is a preliminary assessment tool only. Your tax agent at BB4U will review your answers, confirm the correct legislative position, and advise on the best approach for your tax return. PSI determinations can be fact-specific — final advice requires professional review.

Your answers have been recorded. Your tax agent will be in touch to discuss the result.

PERSONAL SERVICE INCOME - TEST

Books & BAS for You

Personal Services Income (PSI)
& Personal Services Business (PSB) Assessment

Test-by-test summary

PERSONAL SERVICE INCOME - TEST

Personal Services Income (PSI)& Personal Services Business (PSB) Assessment

Test-by-test summary

Personal Services Income (PSI)
& Personal Services Business (PSB) Assessment