Benefits for small businesses in our federal budget
Australia’s 3.2 million small businesses – and the 6.7 million labourers they utilize – are currently praising being viewed as a ‘small’. That is because they’ll have the option to utilise a few select tax concessions.
As per the Australian Taxation Office (ATO), an SBE is any “sole trader, partnership, company or trust that operates a business for all or part of the pay year, and has aggregated turnover under $10 million.”
Here is only a portion of the positive news for SBE’s:
A brought down company tax rate of 27.5 percent – the most reduced in 50 years
– Deductions for some prepaid business expenses
– The continued ability to write off assets up to $20,000 in value
– Increased unincorporated tax discount rate
– Simplified PAYG payment arrangements
– More straightforward trading stock rules
Cultivating growth in Australia’s different SBEs was one of the government’s top needs this budget.
Speaking with Peter Marsh, principal at Marsh Tincknell on the matter, he stated: “The Government’s job is to provide a healthy environment in which small business can thrive. That includes simplifying regulations and encouraging investment in the right areas, as well as providing tax incentives such as the instant asset write off which encourages small business to invest in assets that will help them grow.”
He went on to say that, “By lowering the company tax rate it encourages small businesses to retain profits and invest back into their business, and discourages personal discretionary expenditure.”
Lower company tax rates are unmistakably beneficial to small businesses, however not all benefits are so direct. You will need to be working with a good Accountant to be sure you are getting the most benefit from all of the aforementioned areas.
Also, the legislation offered huge motivating forces to state governments to implement more efficient business registration processes, that are based online. This means that businesses can get up and running faster rather than having to wait for slow manual processes.
At Marsh Tincknell Accountants, we focus on achieving your best possible tax, and business outcome. Overall, this leads to more peace of mind for our clients. Chat to us today about how we can help you.