Access To Small Business Tax Concessions

As a boost for small businesses, the Government will extend access to a number of small business tax concessions by increasing the annual turnover eligibility threshold from $2m to $10m. These measures will apply from July 1, 2016 and they expand the number of small business entities able to access the concessions. From a tax planning perspective some small business owners may look at the timing of their expenditure with the start date being July 1, 2016.

Under the announced measures, businesses with a turnover below $10m will now be able to access a range of existing small business tax concessions. The increase in the threshold will allow an additional 90,000 to 100,000 business entities access to concessions including:

  • The lower company tax rates detailed in this newsletter
  • Simplified depreciation rules, including the immediate tax deduction for assets costing less than $20,000 (up until 30 June 2017)
  • Simplified trading stock rules that give businesses the option to avoid an end of year stocktake if the value of their stock has changed by less than $5,000.
  • Simplified method for PAYG instalment payments
  • The option to account for GST on a cash basis and apply the simplified method of GST instalments payments
  • Immediate deduction for prepaid expenses
  • Immediate deduction for professional expenses
  • Fringe Benefits Tax concessions, including exemptions for car parking and work-related portable electronic devices (applicable from 1 April 2017).

The current $2m turnover threshold will be retained for access to the small business CGT concessions.

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IMPORTANT DISCLAIMER:This newsletter is issued as a guide to clients and for their private information. This newsletter does not constitute advice. Clients should not act solely on the basis of the material contained in this newsletter. Items herein are general comments only and do not convey advice per se. Also changes in legislation may occur quickly. We therefore recommend that our formal advice be sought before acting in any of these areas.