In 2026, the NDIS landscape for sole traders has become more complex with the introduction of Payday Super and stricter GST compliance audits. Navigating the tax maze is no longer just about your annual return—it’s about real-time compliance.

1. GST: When is NDIS Support “GST-Free”?

One of the biggest misconceptions in 2026 is that all NDIS work is GST-free. To avoid charging 10%, four specific conditions must be met under the GST-free Supply (Health Services) Determination:

1. Active Plan: The participant must have a current, active NDIS plan.
2. Reasonable & Necessary: The service must be a “reasonable and necessary” support listed in that plan.
3. Written Agreement: There must be a formal, written service agreement between you and the participant (or their representative).
4. Specified Support: The support must fall under the ATO’s list of GST-free care (e.g., assistance with daily living, therapeutic supports, or social participation).

Pro Tip: If you provide non-NDIS services (like general domestic cleaning for private clients), those hours are taxable if your total business turnover exceeds $75,000.

2. The 2026 “Payday Super” Revolution

Starting 1 July 2026, the biggest change to Australian tax law in a decade takes effect: Payday Super.

• For You (Self-Employed): You are not legally required to pay yourself super, but it is highly recommended for tax offsets.
• For Your Contractors: If you hire other sole traders to help with your NDIS participants, and they work primarily for their labor (hourly rate), you must pay their super at the same time you pay their invoice.
• The Rate: The Super Guarantee (SG) rate for 2026 is 12%.

3. PAYG: Paying Tax as You Go

As a sole trader, you don’t have an employer to withhold tax. Instead, you enter the PAYG Instalments system.

• The Threshold: Once you earn a certain amount (usually after your first $4,000+ tax bill), the ATO will ask you to pay your tax in quarterly “instalments.”
• Budgeting Rule of Thumb: In 2026, with the updated tax brackets, aim to set aside 20% to 25% of every NDIS payment into a separate high-interest savings account to cover your tax and Medicare levy.

4. Top 2026 Tax Deductions for NDIS Workers

To lower your taxable income, maximize these NDIS-specific claims:

• Kilometre Claims: Use the $0.88/km (2025-26 rate) cents-per-km method for traveling between participants (but not from home to your first client).
• PPE & Uniforms: High-vis gear, non-slip shoes, gloves, masks, and branded shirts.
• Insurances: Public Liability and Professional Indemnity insurance are 100% tax-deductible.
• Consumables: Sanitizer, first aid supplies, and any activity materials you buy for participants that aren’t reimbursed.
• Digital Tools: A percentage of your phone and internet bill used for NDIS portals, invoicing apps (like Xero or Rounded), and communication.

2026 Compliance Checklist