Personal services income (definition)
Personal services income (PSI) is income earned by an individual outside of employment. The Australian Taxation Office has rules around what determines income outside of employment.
Currently if more than 50% of the income received was for labour, skills or expertise, as opposed to product, it’s classified as PSI. For tax purposes PSI is treated as your individual income.
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Disclaimer: This glossary is for small business owners. The definitions are written with their requirements in mind. More detailed definitions can be found in accounting textbooks or from an accounting professional. Xero does not provide accounting, tax, business or legal advice.