Tax deductions and accounting for bars and breweries.
You can generally claim your liquor licensing, bar equipment, stock and staffing costs against your venue's income, and if you brew on site there's excise to plan around as well, provided everything relates to earning your income and you keep the records. This guide covers what bars and breweries typically claim, how GST and excise sit alongside each other, and how we keep the numbers current. We're Brisbane based and work with venues right across Australia.
Updated July 2026 · Reviewed by the LINK Advisors team
What bars & breweries can claim.
Ordered by typical value. Every claim still has to pass the ATO's tests: you paid for it, it relates to earning your income, and you can show a record.
Bar fit-out and equipment
Tap systems, coolrooms, glassware and bar joinery are generally deductible, either claimed outright or depreciated depending on the cost and the instant asset write-off rules current at the time - check the current threshold with us.
Liquor licensing fees
Your liquor licence and any renewal or variation fees are generally deductible as a cost of holding the licence that lets you trade.
Stock, kegs and breakages
Beer, spirits, wine and other stock, along with keg deposits and normal breakages, are generally deductible as a cost of goods sold, tracked through your bar stock system.
Brewing equipment and excise
If you brew on site, your brewing equipment is generally deductible, and excise duty on the beer you produce sits alongside your normal tax obligations as its own specialist reporting area worth setting up properly from the start.
Security and RSA-compliant staffing
Wages for security staff and RSA-trained bar staff, along with the training itself, are generally deductible.
Entertainment licensing
Fees for any entertainment or live music licensing required for your venue are generally deductible.
POS and cash handling systems
Point-of-sale hardware, software subscriptions and cash handling equipment are generally deductible as running costs.
Public liability and liquor liability insurance
Premiums for public liability cover, and any specific liquor liability insurance for your venue, are generally deductible.
Utilities and refrigeration running costs
Power for coolrooms, tap systems and refrigeration, which run heavier in a bar than most other hospitality formats, is generally deductible as an operating cost.
GST and BAS, done right.
Drinks sold across the bar are a taxable supply, so you charge GST on them once registered, in the same way as food sold in a restaurant. Where breweries differ is that production also attracts excise duty, which is a separate federal tax on the beer you make, sitting alongside rather than instead of your normal GST obligations.
Excise is its own reporting cycle with its own licensing and lodgement requirements, and it's genuinely worth treating as a specialist area rather than folding it into your regular bookkeeping as an afterthought. Getting the excise licensing and periodic returns set up properly from when you start producing saves a lot of cleanup later.
Bars typically handle a heavy mix of cash and card across a busy night, so reconciling your till and EFTPOS takings against what actually lands in the bank matters more here than in a lot of other hospitality formats. We build that reconciliation into your regular Xero routine so shortfalls or till errors show up quickly, not months later.
The right structure for the work.
Bars and breweries generally carry a higher regulatory and liability profile than most hospitality formats, liquor licensing conditions, RSA obligations and, for breweries, excise licensing all add real complexity, which pushes plenty of owners toward a company structure earlier than a straightforward cafe or takeaway. It's worth having this conversation early, particularly if you're taking on partners or investors to fund fit-out and equipment.
Run the work, we run the numbers.
POS systems built for high-volume bar trade, connected to Xero, keep sales, tips and till reconciliation in one place rather than reconstructed from register tapes. For breweries, production and stock tracking software that talks to Xero makes excise reporting far less painful than trying to piece it together from spreadsheets each period. We set both up properly so the compliance side runs quietly in the background.
Frequently asked questions.
Do breweries pay excise as well as GST?
Yes, generally. Excise duty on beer production is a separate federal tax to GST, with its own licensing and lodgement obligations. We treat it as a distinct compliance stream in your accounting rather than trying to blend it into ordinary bookkeeping.
Can I claim my liquor licensing fees?
Yes, generally. Licensing and renewal fees for your liquor licence are deductible as a cost of holding the licence that allows you to trade.
How do I account for keg deposits and stock breakages?
Keg deposits and normal breakages are generally factored into your stock accounting as part of the cost of goods sold. What matters most is tracking them consistently so a creeping breakage rate shows up in your margins early rather than at year end.
Should a bar or brewery be run through a company?
Often yes, given the licensing conditions, staffing obligations and, for breweries, excise complexity most venues carry. It's worth a proper conversation early, especially if partners or investors are involved in funding the venue.
What do security and RSA staffing costs mean for my payroll?
Wages, super and any training costs for security and RSA-compliant bar staff are generally deductible, and getting the award classifications right for a mixed roster of security, bar and kitchen staff is worth setting up properly from the start rather than correcting later.
Talk to an accountant who knows bar businesses.
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